Brazil's stocks seesawed near the unchanged mark on Friday as gains in state-controlled oil company Petrobras were offset by a slump in airlines and retailers. The Bovespa index of the Sao Paulo stock exchange dipped 0.11 percent to 69,645.7 points. World oil prices surged record highs, helping boost Petrobras but the higher fuel costs prompted a selloff in shares of airlines Gol and TAM.
At the stock exchange, banking shares helped push the Bovespa index lower, slumping in line with their peers overseas on worries about the financial sector following record losses at the world's largest insurer, US-based AIG. Banco Bradesco fell 0.5 percent to 38.2 reais, Banco Itau lost 0.7 percent to 46.9 reais and Unibanco dropped 0.9 percent to 10.56 reais.
Airlines TAM Linhas Aereas and Gol Linhas Aereas slumped 2.05 percent to 37.21 reais and 2.07 percent to 27 reais, respectively, after oil prices surpassed $126 a barrel, stoking concerns about rising jet fuel costs. Oil giant Petrobras gained 1.49 percent to 45.67 reais, tracking gains of nearly 2 percent in crude prices in London and New York.
The real strengthened 0.47 percent to 1.686 per US dollar, buoyed by rising inflows and as exporters sold greenbacks after the recent decline in the Brazilian currency.
Concerns that the government would raise the IOF financial transactions tax on foreign investment in the domestic bond market eased, also helping bolster the real. "This was the talk of the week," said Renato Schoemberger, a trader at the Alpes brokerage. "But I think the IOF tax is not coming."
Investment flows to Brazil, Latin America's largest economy, are expected to keep growing now that the country won an investment-grade credit rating from Standard & Poor's.
Comments
Comments are closed.