EMERGING MARKETS-Brazil markets gain after Petrobras earnings
By Walter Brandimarte RIO DE JANEIRO, April 23 (Reuters) - Brazil's financial markets gained on Thursday after state-run oil firm Petroleo Brasileiro SA released its long-delayed financial statements, raising hopes that it is leaving behind the worst of a corruption scandal that has weighed on the Brazilian economy. Investor optimism was tempered by the realization that Petrobras, as the company is known, still has a tough road ahead to increase oil production and execute its investment plan, whose delay will further weigh on economic activity. The oil firm took a $17 billion write-down to account to for corruption and other losses, including poor planing and declining oil prices. Investors considered the figure high enough to give credibility to its financial statements, which were finally approved by independent auditors. "The release could help build confidence in Brazil among foreign investors," said Frederico Mesnik, partner at investment firm Humaita in Sao Paulo. "Considering that PriceWaterhouseCoopers signed off on these results, the market perception is that there are no more surprises ahead." In a sign that Brazil's perceived risk among investors is declining, five-year credit default swaps for the country tightened for a fourth consecutive day to 225.68 basis points, after reaching a peak of 307 basis points on March 16. The Brazilian real gained 1 percent to 2.98 per dollar, on track to close past the level of 3 per dollar for the first time since the beginning of March. Brazil's benchmark Bovespa index rose 1.3 percent, supported by shares of miner Vale SA, which rallied for a second day on the back of rising iron ore prices .IO62-CNI=SI. Petrobras' common shares gained some 3 percent, but preferred shares lost about 3.5 percent after chief executive Aldemir Bendine said the company will not pay dividends for 2014. Both share classes have rallied more than 50 percent since mid-March. Key Latin American stock indexes and currencies at 1615 GMT: Stock indexes daily % YTD % change change Latest MSCI Emerging 1054.91 0.7 9.55 Markets MSCI LatAm 2690.87 1.74 -3.04 Brazil Bovespa 55311.94 1.27 10.61 Mexico IPC 45297.97 0.15 4.99 Chile IPSA 4054.26 0.44 5.28 Chile IGPA 19650.35 0.39 4.13 Argentina MerVal 11957.899 2.31 39.39 Colombia IGBC 10434.32 0.73 -10.32 Peru IGRA 13035.12 0.08 -11.89 Venezuela IBC 5687.31 -0.04 47.39 Currencies daily % YTD % change change Latest Brazil real 2.9757 1.05 -10.69 Mexico peso 15.319 0.81 -3.75 Chile peso 616.7 0.33 -1.67 Colombia peso 2460 1.20 -2.93 Peru sol 3.132 -0.03 -4.89 Argentina peso 8.8825 -0.03 -3.74 (interbank) Argentina peso 12.8 -0.08 9.37 (parallel) (Additional reporting by Asher Levine in Sao Paulo, editing by Andrew Hay)
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