The Ibovespa rose 0.3% to close at 175,665 on Friday, reversing earlier losses and extending its winning streak to eight consecutive sessions. Brazil generated 58,568 formal jobs in July, well below market expectations of 112,000 and sharply lower than the 145,161 positions created in June. On the inflation front, the PPI increased 1.94% year-on-year in July, easing from 2.47% in June, while the IGP-M declined. The softer labor market and inflation readings may give the BCB room to maintain its current pace of 25-basis-point rate cuts, lending support to credit-sensitive stocks.
Financials advanced, with Bradesco and Itaúsa up 0.9% and Banco do Brasil gaining 1%. Exchange operator B3 climbed 2% after JPMorgan reported that emerging-market equity funds saw higher inflows, with Brazil rebounding following four consecutive weeks of substantial outflows. Utilities also moved higher, led by a 0.9% rise in Axia. Petrobras gained 2% after Bradesco BBI raised its recommendation on the stock to Outperform from Neutral. In contrast, Vale slipped 0.7% after a trial on the taxation of profits generated by the miner’s foreign subsidiaries was suspended.