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Brazil : Brazil Stocks Close Higher For Sixth Day On Global Growth.

Brazilian stocks closed higher Monday, the sixth consecutive winning session, as better-than-expected growth in South Korea added to optimism about the global economy after the U.S. reported a surge in new home sales. Brazil's benchmark Ibovespa stock index closed at 66,443 points, 0.18% higher than Friday's close of 66,323. Volume was light, at 4.08 billion Brazilian reals ($2.3 billion).

South Korea's GDP grew 1.5% in the second quarter, beating estimates of 1.1% growth, the Bank of Korea said Monday. While the data showed a slowdown from the previous quarter's 2.1% expansion, it was nonetheless "a good sign, taking into consideration that Korea is extremely dependent on foreign trade," wrote Andre Perfeito, chief economist at Sao Paulo's Gradual Investimentos brokerage. "Maybe global activity isn't in fact in such a deteriorated state."

In the U.S., new home sales jumped 23.6% in June from the previous month, much better than the 3.7% gain expected. The European stress test of banks also buoyed stocks after a report last week said only seven of 91 banks were unprepared for a deepening crisis. Still, investors were wary of the test because of questions about how strenuous the criteria were for banks.

Gains in the Ibovespa index were also contained by a widening current account deficit. A declining trade surplus, together with rising profit and dividend remittances, pushed Brazil's current account deficit in June to $5.18 billion, from $1.99 billion in May, the Brazilian Central Bank said Monday.

Brazil's trade surplus in June declined to $2.28 billion from $3.44 billion in May as imports rose in the face of a sharp economic upturn in the country.

Foreign direct investment declined sharply in June, to only $708 million, from $3.53 billion in May, the central bank said.

Blue chips were mixed Monday.

Mining giant Vale (VALE, VALE5.BR) slipped 0.26%, to 42.10 Brazilian reals ($23.74). State-controlled oil giant Petroleo Brasileiro SA (PBR, PETR4.BR), or Petrobras, rose 0.4%, to BRL27.90. Telecom leader Tele Norte Leste SA (TNE, TNLP4.BR), or Oi, surged 4.53%, to BRL29.75. Flat-steel maker Usiminas (USIM5.BR) was little changed, ending 0.02% higher, at BRL53.36, while rival integrated steelmaker CSN (SID) gained 0.34%, to BRL29.65. Aircraft manufacturer Empresa Brasileira de Aeronautica (ERJ, EMBR3.BR), or Embraer, rose 1.23%, to BRL10.72.

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Publication:TendersInfo
Date:Jul 27, 2010
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