Brazilian stocks closed lower on Friday, as a surprise move by China to tighten credit pulled down markets world-wide. Brazil's benchmark Bovespa index fell 0.41 percent to 65,854.97, snapping a four-day winning streak. China raised the level of reserves that banks must hold for the second time this year on Friday, a sign the fast-growing country plans to keep inflation and credit in check.
A move by China to cool its economy sparked fears of slower growth world-wide, as the Asian country, a voracious consumer of commodities, has been a major force in helping advance a global economic recovery. Commodities took a hit from the stronger dollar, with the Reuters-Jefferies index down 0.66 percent.
Shares of exchange operator BM&FBovespa shed 2.11 percent to 12.04 reais. The company said on Friday that it is raising its stake in CME Group, the largest operator of US futures exchanges, to 5 percent for $620 million as part of a plan to boost its high-frequency trading capabilities.
Mining company Vale fell 0.6 percent to 42.74 reais. Disappointing fourth-quarter results this week from Vale, the world's largest producer of iron ore, could prompt some analysts to slash their share price target. Shares of steelmaker CSN slipped 0.34 percent to 57.80 reais. The company on Friday raised its bid for Portuguese cement maker Cimpor but offered to buy a smaller stake, in a change of tack aimed at luring shareholder approval for its bid.
Limiting losses, state-controlled energy giant Petrobras, the most heavily-weighted stock in the index, advanced 1.32 percent to 33.80 reais. The company on Friday maintained its estimate for recoverable oil reserves in its Tupi field off Sao Paulo state's coast at 5 billion to 8 billion barrels.
Changes in yields on Brazilian interest rate futures contracts were mixed, with longer-term contracts largely ticking higher. The yield on the contract due January 2011 edged down to 10.24 percent from 10.27 percent. The yield on the contract due January 2012 slipped to 11.45 percent from 11.47 percent.
The chances of central bank chief Henrique Meirelles staying at his post through the end of the year, rather than stepping down to run for public office, got a boost after he distanced himself from running for governor of the state of Goias on Thursday.