Retailers offset banks to lift Bovespa; real firms

SAO PAULO, Brazil, April 8 (Reuters) - Brazilian stocks crawled higher on Wednesday, as gains in retailers were partially offset by a slump in financial stocks on news the government had replaced the head of state-run Banco do Brasil.

Sao Paulo's main stock index .BVSP rose 0.73 percent to 44,146.22, helped by a slight rise in U.S. stocks after news of possible government aid for some life insurers.

Brazil's currency, the real (BRBY) firmed 0.81 percent to trade at 2.20 per dollar.

Brazil's President Luiz Inacio Lula da Silva confirmed on Wednesday that the chief executive of federally owned Banco do Brasil (BBAS3.SA) had stepped down, prompting a slide of nearly 6 percent in its share price.

Earlier, a well-placed source in the presidential palace told Reuters that the bank's CEO, Antonio Francisco de Lima Neto, was forced to resign because the government was unhappy with Banco do Brasil for not lowering interest rates more aggressively to stoke an economic recovery. For more see [ID:nN08200881].

Finance Minister Guido Mantega later denied at a news conference there had been any political influence in the decision.

The government's apparently tough stance on interest rates buoyed retailers such as Lojas Americanas and Lojas Renner on hopes of lower interest rates.

Lojas Americanas (LAME4.SA) jumped 7.9 percent to 7.94 reais a share while Lojas Renner (LREN3.SA) gained 4.3 percent to 17.00 reais.

Banco do Brasil was 5.4 percent lower at 17.87 reais, although Itau (ITAU4.SA) rose 0.5 percent to 28.48 reais, and Nossa Caixa (BNCA3.SA) was flat at 71.25.

Interest rate futures <0#DIJ:> fell on expectations the central bank will continue to cut interest rates after analysts in the latest central bank survey revised down their forecasts for 2009 growth to a contraction of 0.2 percent. (Reporting by Ana Nicolaci da Costa; Editing by James Dalgleish)