Brazil's currency strengthened on Tuesday on the back of a steady inflow of U.S. dollars while stocks zigzagged early eyeing foreign markets. Brazil's real was 0.4 percent stronger at 2.736 per U.S. dollar in early trading, sustained by a flow of funds from abroad from corporate debt issues and foreign investments.

The currency has also appreciated given the greenback's recent slide against major currencies around the world.At the stock exchange, the market's benchmark Bovespa index was up 0.56 percent at 24,995 points, near its all-time high after oscillating in and out of negative territory.

"The trend for the day is very unstable. We're waiting for markets to open in the United States and on flows of funds (into the Bovespa)," said Gustavo Alcantara, a fund manager at Banco Prosper.

Traders said the market had shrugged off gross domestic product data for Brazil released earlier in the day showing the economy grew 1 percent in the third quarter from the second. The numbers were slightly lower than expected by economists but still showed the economy on course to sustain substantial growth in the medium term.

Roberto Mattos, a trader at Agenda brokerage in Rio de Janeiro, said some investors may also be pressuring the stock market higher so that they can close their portfolios for November with stronger gains.

Market bellwether Tele Norte Leste Participacoes was up 0.14 percent at 41.95 reais. Other telecommunications companies trading at the exchange were also doing well early in the day.

(From Reuters, November 30, 2004)

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