September 29, 2022

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Ibovespa drops as commodity stocks weigh;  Louisa magazine sinks after loss By Reuters

Ibovespa drops as commodity stocks weigh; Louisa magazine sinks after loss By Reuters

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© Reuters. Large screen showing quotes from B3, Reuters / Amanda Perubelli

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Written by Andre Roman

São Paulo (Reuters) – The main index of the Brazilian stock market fell on Tuesday, despite a rally in New York, in the face of a fresh decline in commodity-related stocks, especially Vale and Petrobras.

The market awaits monetary policy decisions in Brazil and the US this week and keeps the war in Ukraine in focus. In Brazil, the financial framework and balance sheet season for companies are also on the radar of investors.

By 11:23, it was down 1.48% to 108,301.30 points, heading to the bottom of the fourth consecutive session. The financial volume was 7.4 billion riyals.

The much better-than-expected performance of China’s industrial and retail market in the first two months of the year, as previously reported, was not enough to contain the commodity slump on Tuesday, as the country faces a jump in Covid-19 cases and imposes health restrictions.

And in the case of the UAE, a positive signal from Russia for a nuclear deal involving Iran helped push prices below $100, after hitting more than $130 this month. Although the decline, meanwhile, is generating some relief in inflation and cost pressures, with a strong increase in airlines this session, the impact on Ibovespa via Petrobras stands out, at least in the short term.

In the United States, the major indicators reported an increase of between 0.5% and 0.9%.

The Federal Reserve and the Central Bank begin their two-day meetings this Tuesday. The forecast is for a 0.25 percentage point rise in the US and a 1 percentage point rise in Selic, despite marginal bets of 1.25 points. In comments from the monetary authorities, investors should look for clues about the next policy steps to combat inflation, in the face of the uncertainty scenario about the war in Ukraine.

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In Brazil, financial risks returned to focus the day before, with news that the Economy Ministry was evaluating a proposal to temporarily increase the benefit value of the Auxílio Brasil program if the negative effects of the war in Ukraine on the economy persist.

Highlights

Petrobras BN (SA:) is down 3.9% and ON 4%, affected by a more than 6% drop in the price of Brent oil, which reached its lowest level in nearly three weeks, after Russia supported the resumption of the 2015 nuclear deal. . A deal could free Iran from sanctions that would allow it to increase its exports of the commodity. The spread of the epidemic in China and the war in Ukraine remained on the radar. Petrorio ON fell 4% and 3R Gasoline operated with losses of 4.2%.

– VALE ON (SA 🙂 decreased by 4.6%, the third decline in a row, after declining in Asia with the increase in Covid-19 infections in China, although losses decreased after the release of better-than-expected Chinese economic indicators. CSN (SA 🙂 MINERAÇÃO ON is down 5.8%. USIMINAS PNA (SA 🙂 led to a decline among steel manufacturers with a negative performance of 5.3%.

– The stock of MAGAZINE LUIZA ON (SA 🙂 decreased by 10.5%, after an adjusted loss of OMR 79 million from October to December. The operating result as measured by the adjusted Ebitda was below market expectations, with a strong slowdown in sales in the country’s most negative macroeconomic scenario. Executives at a conference said the company expects a gradual improvement in margins in the coming quarters.

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– AZUL PN (SA:): stock rose 5.6%, and AZUL (SA:) PN rose 4%, as lower oil prices eased pressure on fuel costs. EMBRAER ON (SA 🙂 posted a growth of 1.6%.

– SANTANDER BRASIL UNIT (SA 🙂 is down 1.4% amid a negative banking session. Citi lowered its rating on the stock from “buy” to “neutral” after the stock had performed well recently. The target price was kept at 35 riyals. On Monday, the unit closed at 33.74 riyals, when it jumped more than 4%.

– ECORODOVIAS ON (SA:): advanced 1.9%, after recording a recurring net income of 69.3 million riyals for the fourth quarter, an increase of 25.5% over the same period last year, albeit with a decrease in margins.

– IGUATEMI UNIT lost 3.5% before the expected results were released after the market closed. Yduqs (SA 🙂 and CVC Brasil (SA 🙂 must also publish their numbers at night.

– QUALICORP ON (SA 🙂 rose 4.7%. The company said 3G Radar, in which 3G Capital holds a minority stake, raised its stake to 10.03% of the company’s capital, up from 5.3% previously, according to a December regulatory filing.