Concerns that dragged on through 2021 set the tone for the first day of trading on the Brazilian Stock Exchange in 2022.
Amid protests by civil servants for salary increases, signs that the government of President Jair Bolsonaro is still far from balancing the country’s accounts contributed to the 0.86% drop in the Ibovespa on Monday (3).
The country’s stock market benchmark index ended the day at 103,921 points. It is the lowest mark since December 1st, when the index had retreated to 100,774 points.
Reflecting the tension generated by the fiscal risk, the dollar rose 1.54% to R$5.6620.
Market tension also put pressure on the yield curve. The DI contracts for January 2023, which are a benchmark for the credit market this year, rose 0.08 percentage points, at 11.87% per year.
For January 2024, the DI rate jumped 0.22 percentage points, to 11.19% per year.
After having changed the spending ceiling rule to increase the number of payouts with the payment of Auxílio Brasil this year, when he will seek re-election, Bolsonaro is being pressured to readjust the salaries of several categories of civil servants.
In an act similar to that orchestrated at the Federal Revenue in recent days, the union that represents the Central Bank’s employees started a movement to hand over leadership positions in the autarchy on Monday.
“The year has passed, but the problem is the same. Not even the approvals of the PEC dos Precatórios and the 2022 Budget have diluted this fiscal risk that is haunting the market,” commented Camila Abdelmalack, chief economist at Veedha Investimentos.
Statements by the government leader in the Chamber, Deputy Ricardo Barros (PP-PR), also guided the market this Monday, according to Felipe Vella, technical analyst at Ativa Investimentos.
Barros stated that the episode of floods in Bahia, given the rise in revenue, shows that Brazil needs to rethink its fiscal anchor.
“We have speeches from the government leader in the Chamber who assume that, with the government’s revenue record, the country needs to spend, thus defending changes in the spending ceiling, including talking about increases for the civil service, which has been threatening strikes in recent times “, commented Vella.
“With this, the market as a whole was afraid of new interventions and legal uncertainty, which caused long interest rates to rise and the stock market as a whole to fall with new concerns about the fiscal,” said the analyst.
Oil appreciated 1.59%, to US$ 79.02 (R$ 444.90), which contributed for Petrobras to rise 2.25% in the session of the Brazilian Stock Exchange.
The most valued shares on the trading floor in the country were those of CSN Mineração (4.60%), announced this Monday as a new member of the Ibovespa.
Construction company Cyrela fell 7.98%, the session’s biggest low. The rise in the interest rate curve is one of the factors that contributed to the fall of the civil construction sector, according to Jansen Costa, founding partner of Fatorial Investimentos
In the United States, equity markets closed higher on the prospect that the advance of the omicron variant will not result in severe shutdowns of economic activity.
Dow Jones, S&P 500 and Nasdaq rose 0.68%, 0.64% and 1.20%, respectively.
Nubank rises 6.4% with a rise in the price indicated by analysts
Listed in New York, shares of Nubank rose 6.40% on Monday, after analysts began to cover the bank recommending buys.
Analysts at Goldman Sachs began hedging the paper with a target price of US$15 (R$84.45), while UBS BB gave a target price of US$12.50. Citi, $12.
Nubank debuted on the NYSE (New York Stock Exchange) in December, at US$9 (R$50.67) per share. At the close of this Monday’s session, the stock was worth $9.98.
The combination of the large customer base and customer-oriented culture offers competitive advantages in the Latin American banking sector, said analysts at UBS BB. Still, they added that “there is a long way to go, fraught with regulatory and enforcement risks.”
Goldman Sachs has predicted net income of $3.4 billion for Nubank and return on equity of 39% through 2025, saying this is “consistent with the profitability of other digital banks globally and above profitability levels of 20% % to 30% that traditional retail banks had in Brazil”.
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