Around the World's Markets: Sao Paulo

BRAZILIAN shares were trading higher in afternoon trade after a further depreciation of the real made stocks cheaper in dollar terms. The benchmark Bovespa index was up 267.28 points - or 3.17 per cent - at 8702.76. A major options expiry also boosted the share index, traders said.

However, analysts warned that the longer term outlook for Brazilian shares was more mixed amid concerns that support for the govenrment's austerity plan was slippng.

One said: "The political situation is getting more problematic. A new Congress is coming in just when the president's popularity is waning".