Brazil stocks rebound with Wall Street; real eases

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BRASILIA, July 8 (Reuters) - Brazil's stock index rose on Tuesday, recouping earlier losses in tandem with a rebound in U.S. stocks, while the national currency eased against the dollar.

Brazilian shares earlier dipped along with global stock markets, but a pullback in oil prices below $136 a barrel came as a relief to global investors worried about consumer and business spending, pushing shares higher.

Sao Paulo's benchmark stock index, the Bovespa .BVSP, rose 0.76 percent to 59,535.95 points even as its top weighted stock, oil giant Petrobras (PETR4.SA: Quote, Profile, Research), fell more than 3 percent to 40.61 reais. This even as Lehman Brothers raised the company's price target to $65 from $62.

Markets in Sao Paulo are closed for a holiday on Wednesday.

Brazil's currency, the real BRBY, weakened 0.75 percent to 1.614 per dollar as the greenback rebounded after Federal Reserve Chairman Ben Bernanke said the U.S. central bank may keep an emergency lending facility open beyond the end of the year to provide a credit lifeline for big Wall Street firms. For details, see [ID:nN08193843]

The news helped boost U.S. financial shares, providing a lift to Brazilian banks. Banco do Brasil (BBAS3.SA: Quote, Profile, Research), Banco Bradesco (BBDC4.SA: Quote, Profile, Research) and Unibanco (UBBR11.SA: Quote, Profile, Research) all rose between 3.2 percent and 5.1 percent on the day.

"In the short term, the tendency of the Bovespa is to follow closely the volatility of Wall Street," said Pedro Galdi, analyst at SLW brokerage in Sao Paulo.

The fall in the price of crude also helped battered airlines rebound. Gol Linhas Aereas (GOLL4.SA: Quote, Profile, Research), Brazil's second largest airline, rose 3.4 percent to 14.18 reais, while TAM Linhas Aereas (TAMM4.SA: Quote, Profile, Research) rallied nearly 6 percent to 25.69 reais.

On the downside, steelmaker Usiminas (USIM5.SA: Quote, Profile, Research) fell 0.5 percent to 69.66 reais after it said it would expand and accelerate investment plans. Elsewhere in the sector, Brazilian steelmaker CSN (CSNA3.SA: Quote, Profile, Research) fell 0.2 percent to 61.80 reais. (Reporting by Ana Nicolaci da Costa; editing by Gary Crosse)