Stock market deepens with crisis between servers and Bolsonaro

Stock and foreign exchange markets once again reflected the increased perception of investors about the country’s fiscal risk this Tuesday (4), which grows in the wake of the crisis between the civil servants’ elite and President Jair Bolsonaro (PL).

The Ibovespa closed down 0.39% to 103,513 points. With this, the reference index of the Brazilian Stock Exchange accumulates a loss of 1.25% in the first two trading sessions of 2022. The country’s stock market closed 2021 with a drop of 12%.

Parameter to measure investor confidence in the country’s economy, the dollar ended the session in a fall of 0.47%, to R$ 5.6890. Expectations of interest rate hikes in the United States also drove the rise in the US currency.

The monetary tightening promised by the Fed (Federal Reserve, the central bank of the United States) has valued US Treasury bonds, which attract to itself investments formerly applied in the stock markets. This movement has been promoting the global appreciation of the dollar at the beginning of the year.

Despite the external turmoil, analysts point to the domestic political scenario as the main responsible for the negative performance of the country’s stock market.

“The fiscal scenario continues to weigh on the national market, especially after new demands from public servants for salary increases”, says economist Alexsandro Nishimura, a partner at BRA.

The XP Investimentos report distributed on Tuesday highlighted that the concern with increases in personnel expenses puts fiscal risk back on the radar of investors, which had gone out of focus at the end of last year with the approval of the PEC dos Precatórios and the 2022 Budget.

XP’s analysis of fiscal risks, released last week, also points to the payroll tax relief as a point of concern, as the 2022 Budget does not detail rules for offsetting tax revenue waivers.

In the global scenario, the rise in interest rates and inflation are consolidated as greater concerns for the market than the advance of Covid, which records a record high due to the omicron variant.

“At least from the point of view of economic activity, Covid worries less because it has been generating low numbers of hospitalizations and deaths”, says Romero de Oliveira, from Valor Investimentos.

In the United States, the Nasdaq retreated 1.33%. The stock exchange of technology companies is the most affected by the expectation of an increase in interest rates, as it concentrates companies that are still forming cash and, therefore, with operating costs affected by the increase in interest rates on financing.

In the opposite direction, the Dow Jones, the most traditional stock index in the country, rose 0.59% and renewed its highest historical score.

The S&P 500 index, a reference in the American market, dropped 0.06%.

On the Brazilian stock exchange, CSN Mineração rose 7.09%, registering the biggest increase of the day. The appreciation of iron ore and the prospect of a rise in the exchange rate benefited the mining, steel and meat processing sectors, according to Ativa Investimentos.

Negative highlights for Banco Inter, which dropped 13.68%, and for Banco Pan, which dropped 7.82%. Retail and technology companies retreated on the rise in future interest rates.

Petrobras rose 0.38%, driven by the appreciation of oil in the international market. The barrel of Brent rose 1.27%, to US$ 79.98 (R$ 450.31).

OPEC (organization of producing countries) and its allies decided to maintain the current level of production increase, which is 400,000 barrels per day. The pace of production keeps the price of the commodity heated amid the growth in demand due to the resumption of economic activities.