Brazil stocks, real gain on US economy data

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SAO PAULO, Dec 5 (Reuters) - Brazil's stock market rose on Wednesday, closing at its third highest level ever, and the currency gained after U.S. indicators showed strength in the economy that eased fears of a recession that could cut capital flows to emerging markets.

The Bovespa index .BVSP of the Sao Paulo Stock Exchange jumped 2.28 percent to 64,927.96 points. The index gained for seven straight sessions, up 9.9 percent in the period.

The Brazilian real (BRBY) strengthened 0.61 percent to 1.798 per dollar, recovering from a 0.8 percent drop the previous session.

Data on the U.S. economy on Wednesday showed companies added staff at the fastest pace in a year and productivity rose at the strongest level in four years in the third-quarter.

The figures helped boost optimism over the health of the U.S. economy, pushing the Dow Jones industrial average 1.1 percent higher and the Nasdaq Composite Index 1.3 percent.

"The market today was tracking overseas (equities) more closely and the improvement there had a positive effect here," said a trader at a local brokerage who didn't want to be named.

Interest-rate futures <0#DIJ:> on the Brazilian commodities and futures bourse BM&F rose, after local indicators showed faster-than-expected industrial output expansion in October and higher than expected inflation figures.

The data may prompt the central bank to remain cautious in its decision on the benchmark Selic lending rate later on Wednesday. All 20 economists in a Reuters survey expect the bank to keep rates unchanged at an all time low of 11.25 percent.

On the stock market, state-controlled oil company Petrobras (PETR4.SA) rose 5.37 percent to 78.5 reais.

Perdigao (PRGA3.SA), Brazil's biggest food company, jumped 4.6 percent to 45.5 reais after a newspaper report that Kraft Foods Inc. would take over Perdigao. Kraft and Perdigao denied the report.

Miner Vale (VALE5.SA), previously known as CVRD, rose 2.1 percent to 53.4 reais, as prices of copper, nickel and other metals edged higher.

Gerdau (GGBR4.SA), the biggest producer of long steel products in the Americas, rose 1.24 percent to 51.39 reais. The company said on Wednesday it will invest $400 million in one of its Brazilian units to start making flat-rolled steel.

TAM Linhas Aereas (TAMM4.SA), Brazil's biggest airline, tumbled 2.04 percent to 49 reais and Gol Linhas Aereas (GOLL4.SA), the country's no. 2 airline, lost 2.54 percent to 46.1 reais. Brazil's defense ministry said late on Tuesday it would implement a series of measures in a bid to solve a nagging air travel crisis in the country.

The measures, including a surge in landing fees and rebates for passengers in case of flight delays, "would have a negative impact on airlines' operations," Credit Suisse said in a report.

ArcelorMittal Inox Brasil ACES4.SA, which soared over 9 percent the previous session after parent company ArcelorMittal announced plans to buy all outstanding shares in the Brazilian subsidiary for up to 3.2 billion reais, retreated 1.21 percent to 96.31 reais as shareholders considered the offer.

ArcelorMittal said it would offer 100 reais per common or preferred share in the unit, previously known as Acesita. (Reporting by Rodolfo Barbosa and Elzio Barreto, Editing by Chizu Nomiyama,)