Brazil stocks higher on recovery views, real firms

SAO PAULO Nov 11 (Reuters) - Brazilian stocks rose on Wednesday as stronger-than-expected Chinese industrial data stoked appetite for riskier emerging market assets and reinforced investor optimism about a global economic recovery.

Brazil's benchmark Bovespa index .BVSP added 0.81 percent to 66,839.27 in morning trading, on track to book a third straight day of gains.

Brazil's currency, the real BRBY, strengthened 0.47 percent to 1.709 per dollar as the greenback hit a 15-month low against the major currencies.[ID:nLB194707]

Chinese factory output growth surged to a 19-month high in October. China, the world's third largest economy and a voracious commodities consumer, is widely considered a driver in a global economic recovery. [ID:nPEK212006]

"People want to take on risk," said Carlos Camacho, a fund manager with GAP Asset Management in Rio de Janeiro, said on the Chinese industrial data. "There's a more positive feeling as the year draws to a close."

Chinese industrial growth surged 16.1 percent in the year to October, easily beating market forecasts of 15.5 percent growth.

The lower dollar and news from China also pushed raw materials higher. The 19-commodity Reuters-Jefferies index .CRB rose 0.58 percent, and crude oil CLc1 climbed 0.83 percent.

Those gains helped companies in Brazil, including oil producer Petrobras and mining giant Vale, the two most heavily-weighted stocks in the Bovespa index.

Petrobras (PETR4.SA) climbed 1.07 percent to 37.81 reais. The company is slated to report third quarter earnings on Friday. Bradesco expects "strong results" on the back of exports, domestic sales volumes and higher oil prices, noted a report dated Wednesday.

Vale (VALE5.SA), the world's largest iron ore producer, added 0.42 percent to 42.83 reais.

BM&FBovespa (BVMF3.SA), the world's fourth-largest exchange operator by market value, climbed 1.2 percent to 12.61 reais. The company sees better-than-expected stock and derivatives trading volumes in 2009 helping to stoke earnings, its CFO said in a conference call on Wednesday. [ID:nN11251509]

Steelmakers also advanced. Gerdau (GGBR4.SA) moved up 1.7 percent to 28.78 reais, Usiminas (USIM5.SA) gained 0.94 percent to 50.32 reais and CSN (CSNA3.SA) rose 1.02 percent to 60.25 reais. Steelmakers have benefited from the expectation that the 2014 World Cup and 2016 Olympics, both slated for Brazil, will generate construction and infrastructure projects.

Yields on Brazilian interest rate futures contracts <0#DIJ:> remained flat or ticked slightly higher.

Investors use the contracts to bet on trends in the country's benchmark interest rate, the Selic, currently at a record-low 8.75 percent.

The yield on the contract due January 2011 DIJF1 edged to 10.19 percent from 10.16 percent. The yield on the contract due January 2010 DIJF0 inched to 8.645 percent from 8.641 percent. Both were among the most heavily-traded contracts of the morning.

Brazilian inflation quickened in October over September, though inflation over the past 12 months remained within policymakers' 2009 target of 4.5 percent, plus or minus 2 percentage points. [ID:nN11362114]

Policymakers use the inflation target in setting interest rates. (Reporting by Luciana Lopez, editing by W Simon )