Despite the fresh numbers that suggest that Brazil’s economy is sinking at a rapid pace, most of the nation’s ADRs jumped up during the previous session. Surprisingly, the scandal-hit Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) too went green in response to broader market optimism about Brazilian stocks. The speculations pointing that the Federal Reserve might not raise the interest rates infused new energy in Brazilian stocks as the move could boost demand for emerging market equities.
Weighed on protests
According to Rogerio Freitas of Teorica Investimentos hedge fund, the external outlook remains positive for Brazil. He said that the Fed will act on monetary policy at a gradual and slow pace. Meanwhile, thousands of protestors on the streets of Brazil have rocked both President Dilma Rousseff and Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR). Investors weighed on the likely outcome of the mass public protests on President Rousseff’s ability to execute measures to address budget deficit and sovereign downgrade, which led to advancement in Brazilian stocks.
Corruption investigation gets deeper
Meanwhile, President Rousseff received another setback from Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR) case as prosecutors charged the government’s treasurer for his connection to the scandal. Prosecutors said that they have sufficient evidence to show how Treasurer Joao Vaccari solicited funds in the form of donations from the company’s former executives. Prosecutors claimed that Vaccari was aware that the funds solicited are sourced from bribes, but the Workers’ Party maintains its stand that donations it received were legal.
The charge on Vaccari gave an opportunity to Rousseff as she said that the fresh revelation shows that her party is not interfering with the investigations to clear its name. Rousseff continues to maintain that she had no knowledge of the corruption taking place at Petroleo Brasileiro Petrobras SA (ADR) (NYSE:PBR). Her statements pose doubts in view that she remained chairwoman of the board of the company during 2003 to 2010, precisely the years when the corruption occurred.