UPDATE 7-Brazil's Lula detained in corruption probe; Rousseff objects
* Highest profile development in two-year-long investigation
* Questioning brings graft probe closer to President Rousseff
* Brazil markets rally in hopes of new governing coalition (Adds details of Rousseff news conference, Ipsos poll)
By Brad Haynes and Anthony Boadle
SAO PAULO/BRASILIA, March 4 (Reuters) - Former Brazilian President Luiz Inacio Lula da Silva was briefly detained for questioning on Friday in a federal investigation of a vast corruption scheme, fanning a political crisis that threatens to topple his successor, President Dilma Rousseff.
Lula's questioning in police custody was the highest profile development in a two-year-old graft probe centered on the state oil company Petrobras, which has rocked Brazil's political and business establishment and deepened the worst recession in decades in Latin America's biggest economy.
The investigation threatens to tarnish the legacy of Brazil's most powerful politician, whose humble roots and anti-poverty programs made him a folk hero, by putting a legal spotlight on how his left-leaning Workers' Party consolidated its position since rising to power 13 years ago.
Police picked up Lula at his home on the outskirts of Sao Paulo and released him after three hours of questioning. They said evidence suggested Lula had received illicit benefits from kickbacks at the oil company, Petrobras, in the form of payments and luxury real estate.
The evidence against the former president brought the graft investigation closer to his protege Rousseff. She is already fighting off impeachment for allegedly breaking budget rules, weakening her efforts to pull the economy out of recession. Continuación...