SAO PAULO: Brazil's blue-chip Bovespa index led gains across Latin American equities markets on Thursday, jumping 2.3 percent after the Wall Street Journal reported that Boeing Co had entered into potential takeover talks with Brazilian planemaker Embraer SA.
According to the Journal, Boeing and Embraer have been discussing a deal in which Boeing would pay a relatively large premium on Embraer's shares, but the parties are waiting to see if Brazil's government would approve such a deal.
Brazil-listed shares in Embraer shot up 21.3 percent after a brief halt in trading, and were trading at 20 reais ($6.06) by mid-afternoon.
Brazilian equities also rose on comments by Finance Minister Henrique Meirelles that temporarily warded off fears of a credit downgrade.
Speculation has swirled that major credit ratings agencies like S&P and Fitch, both of which give Brazil a BB, will downgrade Brazil's debt as the nation's legislators struggle to pass a pension legislation overhaul seen as key to shoring up the country's budget deficit.
However, Meirelles said he had not discussed a credit downgrade in recent meetings with S&P, Fitch and Moody's, adding that he had received no information suggesting such a move was imminent.
The Bovespa had popped 2.34 percent by mid-afternoon, with most of those gains coming after Meirelles' comments and the Embraer news.
The stock index was also aided by the performance of state-owned oil major Petroleo Brasileiro SA, known as Petrobras.
Shares in Petrobras shot up over 3 percent to 15.71 reais after the company unveiled an investment plan projecting $74.5 billion of capital expenditure from 2018 to 2022, slightly above projected investment for the 2017 to 2021 period.
In a note to investors, Itau BBA analyst Andr? S. Hachem called the company's plan to start up eight new platforms during that time "ambitious."
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