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Brazil: Stocks rally for second straight day

[SAO PAULO] The Sao Paulo stock exchange surged for the second straight day on Wednesday to close up 7.5 per cent, as plans for massive stimulus packages to combat the coronavirus pandemic boosted world markets.

It was the first back-to-back gain this month for Brazil's Ibovespa index, which has been pummelled by the global health crisis.

Latin America's biggest stock exchange gained 9.69 per cent on Tuesday.

The surge came despite an eruption of political tension in Brazil, where President Jair Bolsonaro gave a national address Tuesday night in which he sharply criticised what he called the "scorched-earth" coronavirus containment measures being taken by some local authorities.

Mr Bolsonaro condemned virus "hysteria" and said closing businesses and telling people to stay home in places such as Sao Paulo and Rio de Janeiro was wrecking the economy.

That drew backlash from his opponents, as well as from the medical community.

But the tension was outweighed by positive news overseas, including advancing plans for unprecedented stimulus spending in the United States and Germany.

The Ibovespa "is basically following the external market," said Pedro Paulo Silveira, chief economist at Nova Futura Investimentos.

"But I think eventually the market's going to pay the price for this internal noise" in Brazil, he added.

"We've still got tough times ahead."

AFP