Petrobras rises 3% and boosts Ibovespa.

By Paula Barra • Marina Neves

SÃO PAULO - After trading in the red during the morning, the stock market turned positive this afternoon, with the Ibovespa index rising 1,39% to 49.471 points around 13:34 PM (Brasilia time). Among the highlights are Petrobras shares, which, after falling as much as 4%, also turned positive this afternoon – helping to boost the index. Investors are also keeping an eye on steel company stocks, which surged in this session amid expectations of new stimulus for the Chinese economy. See the highlights of this Monday:

Vale and steel companies: Shares of Vale and steel companies are among the biggest gainers on the Ibovespa this Monday. Leading the index's gains are shares of Usiminas (USIM5, R$ 3,84, +8,47%), CSN (CSNA3, R$ 4,94, +7,86%), Gerdau (GGBR4, R$ 10,41, +6,55%), Metalúrgica Gerdau (GOAU4, R$ 11,02, +4,95%), as well as Vale (VALE3, R$ 21,79, +6,71%; VALE5, R$ 18,84, +5,78%) and Bradespar (BRAP4, R$ 13,07, +5,83%), the holding company that owns a stake in the mining company.

Weak export and import data from China in January is reflected in the market. But the news, which could sound negative, opens up space for new stimulus measures there, according to Guide Investimentos. Last week, the People's Bank of China announced a 0,5 percentage point cut in the reserve requirement ratio – the first cut in almost three years. With this, the rate for large banks became 19,5%. 

Localiza (RENT3, R$ 35,07, -0,65%) The car rental company Localiza earned R$ 102,2 million in the fourth quarter of last year, a growth of 13,6% compared to the same period in 2013. For the full year, the profit was R$ 410,6 million, an improvement of 6,8%.

Banco do Brasil (BBAS3, R$ 22,05, +0,68%) Banco do Brasil shares are taking a break in this session after falling almost 4% last Friday, when Aldemir Bendine's departure from the bank's presidency was announced. According to XP Investimentos, Bendine's confirmation at Petrobras is a cause for concern for the bank, which is the main creditor of the oil company and related companies, and could be another company heavily influenced by the government.

Abril Educação (ABRE3, R$ 11,84, +16,88%) Thunnus Participações, a company owned by investment funds managed by Tarpon Investimentos, has signed an addendum to its contract with Bloco Abrilpar to assume control of Abril Educação, according to a relevant fact disclosed this Monday. Under the terms of the deal, Thunnus will acquire an additional 20,73% of Abril Educação's total share capital, so that Thunnus will have purchased, in total, all of the company's shares held by Bloco Abrilpar, representing 40,64% of the company's voting and total capital.

The final price in the contract and addendum for the deal is R$ 1,31 billion, or R$ 12,33 per ordinary share of Abril Educação. Thunnus will submit documentation to the Securities and Exchange Commission (CVM) within 30 days of the closing of the transaction regarding the mandatory public offering (OPA) for the acquisition of the company's remaining shares, at the same price per share paid to the controlling shareholders, Abril Educação added.

Petrobras (PETR3, R$ 9,30, +2,99%; PETR4, R$ 9,33, +2,30%) After falling as much as 4%, Petrobras shares reversed course and rose amid rising oil prices, which are up 3,71% at US$53,61 per barrel for WTI, traded in the US, and 1,57% at US$58,71 for Brent, traded in the UK. The rise comes after a sharp drop in the shares following the announcement of a change in its board of directors, with the replacement of president Maria das Graças Foster by Aldemir Bendine, then president of Banco do Brasil. Amid uncertainties surrounding the company's outlook, Credit Suisse today downgraded its recommendation for the state-owned company from neutral to underperform, with the target price for its ADRs (American Depositary Receipts) dropping from US$7,30 to US$5,00. Adapted to the Brazilian market, this revision would correspond to a cut in the target price for the company's ordinary shares from R$10,00 to R$6,50.

Today, Mark Mobius, executive chairman of Templeton for emerging markets, said at an event that the oil company should sell its assets, including Campos, and also stated that Aldemir Bendine should increase transparency in the company, but that the market has to give Bendine time to see what he will do.

ALL (ALLL3, R$ 4,53, -1,52%) and Cosan Logística (RLOG3, R$ 2,74, -0,72%) The CADE (Administrative Council for Economic Defense) has included in the agenda of its next extraordinary judgment session, scheduled for the 11th, the merger between Rumo Logística, controlled by Cosan (CSAN3), and ALL, when the rapporteur is expected to present his opinion. The CADE's decision is widely awaited by the market, which expects the agency to issue a favorable opinion, even with the possibility of some restrictions. Last week, ALL shares jumped 19,5%, while Cosan Logística shares rose 26%.

Banco ABC Brasil (ABCB4, R$ 11,90, 0,00%) Banco ABC Brasil had its recommendation upgraded to outperform by BB Investimentos.

Hypermarcas (HYPE3, R$ 17,51, -0,51%) The pharmaceutical and consumer goods company Hypermarcas saw a more than 30% increase in its net profit in the fourth quarter compared to the same period in 2013, driven by a reduction in net financial expenses. Net profit was R$ 71,5 million from October to December, a 30,2% increase compared to the same period of the previous year. The average of analysts polled by Reuters anticipated a 65,8% increase in net profit.

Eletrobras (ELET3, R$ 5,14, -0,19%; ELET6, R$ 6,14, 0,00%) After PwC refused to sign off on Petrobras' financial statements, KPMG is demanding that Eletrobras and other state-owned energy companies provision for corruption in their balance sheets, Veja magazine's Radar column reported today.

Braskem (BRKM5, R$ 12,65, -1,86%) Braskem (BRKM5) stated that it may interrupt production amid uncertainty regarding naphtha supply from Petrobras, according to a report by Estadão. Currently, the petrochemical company is the sole buyer of naphtha in Brazil and the largest supplier to the chemical industry. According to the company, whose partners include the Odebrecht group (38%) and Petrobras itself (36%), if the situation reaches a critical point, three Brazilian petrochemical complexes may have to halt production.

Qualicorp (QUAL3, R$ 21,96, -5,83%) After suffering considerably last week, Qualicorp shares are trading in the red again this Monday following indications of government interference in the company. A news report from Folha de S. Paulo indicated that the government wants more individual health plan offerings. According to the report, the Ministry of Health will announce, by the next semester, a package of measures to change the service model and reorganize the health plan sector in the country. It is worth highlighting the financial volume of the shares, at R$ 417,2 million, compared to R$ 50,7 million in the last 21 trading sessions – for comparison, this volume is almost twice that of Vale's shares. The downward movement occurred with the possibility of greater flexibility in individual plans. "Following what happened in the education sector, there is potential for deregulation of individual health plans. Fear and uncertainty in the market are driving the selling of this asset, which could suffer even further," said Celson Plácido, chief strategist at XP Investimentos.

The Ministry of Health and the ANS (National Supplementary Health Agency) explained that both have ongoing studies on the current scenario of the supplementary health sector and appropriate ways to improve the quality of service provision and its sustainability. According to them, one of these items under analysis is individual health plans, with the aim of guaranteeing the supply of this type of service, which has been declining in recent years. This is why the topic has been under study by the ANS since 2012, when it was included as a priority in its Regulatory Agenda.