2014.11.1821:54:27UTC+00Brazilian stocks advance led by Bradesco, low valuation

Brazilian stocks rallied with the Ibovespa breaking a three-day losing streak after Banco Bradesco headed lender advance amid low valuations.

The Ibovespa rose by 1.6% to 52,061.86 at the end of trade in Sao Paulo with the nation’s currency strengthening by 1% to match the dollar at 2.5828 real per dollar. The gauge was recently at it year high last September but has since then shed a total of 16%.

Banco Bradesco SA or the second-largest bank by market value in Latin America, surged by 4.5% to lead financial stocks higher. Itau Unibanco Holding added 2.9% while homebuilder Gafisa climbed by 0.4% after it announced a buyback plan. Vale SA shed 4.6% after raw materials extended declines to its lowest in five years.

In China, new home prices in every government monitored city except for one amid the developer offered discounts to cut inventories dragging stocks down.

Partner at Orama, Alvaro Bandeira commented to Bloomberg that following the numerous days of losses, several stocks are now seen as cheap that’s why it’s only natural to see recovery in the market. Bandeira adds the the advance in banks are due to the fact that banks are considered as a defensive investment as they have the ability to perform well whether the situation is good or bad in Brazil.