Bloomberg News

BM&FBovespa Gains on Commodities Exchange Plan: Sao Paulo Mover

February 02, 2012

Feb. 1 (Bloomberg) -- BM&FBovespa SA, the operator of Latin America’s biggest securities exchange, headed for the highest close in eight months on speculation the Brazilian government may stimulate the commodities market.

BM&FBovespa gained 3.8 percent to 11.41 reais at 3:03 p.m in Sao Paulo, the highest price on a closing basis since May 16. The benchmark Bovespa index rose 2 percent.

Brazil may create a commodity derivatives exchange similar to the Chicago Mercantile Exchange or spur trading at the BM&FBovespa to increase volume and attract investors, Sao Paulo- based Valor Economico reported, citing an unidentified person from the government’s economic team.

“The government’s intention appears to be an opportunity for BM&FBovespa, rather than a threat,” analysts Regina Sanchez, Alexandre Spada and Thiago Batista, from Banco Itau BBA SA, wrote in a note to clients today. Boosting BM&FBovespa’s soft commodities market would be “the fastest, safest and cheapest way to expand soft commodities trading locally,” they said.

“The news surprised me in a positive way,” BM&FBovespa Chief Executive Officer Edemir Pinto told reporters at an event in Sao Paulo today. “This would help solve liquidity issues and establish fairer prices for agricultural commodities in Brazil.”

--Editors: Glenn J. Kalinoski, Marie-France Han

BVMF3@BS

To contact the reporter on this story: Katerina Petroff in Sao Paulo at kpetroff@bloomberg.net

To contact the editors responsible for this story: Helder Marinho at hmarinho@bloomberg.net; David Papadopoulos at papadopoulos@bloomberg.net


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