Gringos na Bolsa, selling flying cars and what matters in the market

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What brings gringos to the stock exchange?

With a high accumulated in the year of 9.88% until this Wednesday (16), the Ibovespa has shown strength against international peers, while the real continues to appreciate. The dollar reached R$ 5.13, the lowest price in almost seven months.

A good part of this movement can be explained by the inflow of foreign money into the country. The gringos landed more than BRL 47 billion in the Brazilian stock market this year.

Understand The reasons that bring the dollars here:

Exchange: the inflow of dollars into the country helps to cool down its price. The movement already usually happens at times of high commodities, when exporters repatriate sales proceeds.

In terms of inflation, the exchange rate traditionally helps to dampen the advance in raw material prices. The exception happened last year, as explained by Samuel Pessôa in this October column.

Attractive: The government is considering exempting foreigners who invest in private securities (such as corporate debt) from paying income tax on their capital gains, according to Reuters.

They are already exempt from this charge for investments in public debt and in the local stock market. The idea is that this will attract even more dollars to the country.

Heineken predicts more costs and less consumption

Heineken highlighted, in the disclosure of its 2021 results, that it will continue to increase beer prices as a reflection of the high costs and also considered inflation as a limiting factor for the consumption of the drink.

What explains: the second largest brewer in the world – behind AB InBev, parent company of Ambev – projected that supply chain bottlenecks as a result of the pandemic will continue in 2022.

• This puts pressure on costs for brewing beer, and inputs such as barley and aluminum are expected to stay 50% and 100% more expensive, respectively.
• With more spending, the brewery will raise the prices of drinks, and considers that people should consume less because of this.

Is here? Heineken reported in its results that, even with the high prices, the consumption of its brands in Brazil grew by more than 10% in the fourth quarter, driven by the mainstream (common) and premium labels – a segment it leads.

• The company also said that the sales volume of Heineken beer in the country has already doubled compared to the pre-pandemic level in 2019, and that Brazil has become the largest global market for the zero-alcohol version of the brand.

Growing: the non-alcoholic beer market in the country jumped from a level of 140 million liters sold in 2019 to 260 million liters in 2021, showed the Panel SA column

Demand for flying cars continues in 2022

Eve, a subsidiary of Embraer, announced this Wednesday that it had received an order for up to 90 eVTOLs, also known as “flying cars”.

The business: the buyers are Australian. Up to 50 aircraft will go to companies that serve tourist attractions, which claim to have chosen Eve’s models for their environmental footprint and low noise emitted.

Understand: eVTOLs are electric vehicles with vertical take-off and landing (we explain here how they work). They are considered a cheaper, quieter and less polluting alternative to helicopters.

exploded: Eve received orders for 1,735 aircraft by the end of 2021, with values ​​corresponding to around $5 billion (R$ 25.8 billion).

The high demand for this type of aircraft leveraged Embraer’s shares last year, which had the highest performance among Ibovespa companies after accumulating a high of 197% in the period.

IPO: At the end of last year, Eve announced that it will list its shares on the New York Stock Exchange (NYSE), with the offer for the second quarter of 2022.

• It will be carried out from the merger with the American Zanite Acquisition Corp, which is a “specific purpose acquisition” vehicle (Spac).
• The format works as a kind of blank check that shareholders give to investors, who look for projects to allocate capital only after raising the funds.
• The transaction valued Eve at $2.9 billion (R$ 16 billion). Embraer will remain with a stake of approximately 82% in its subsidiary after an additional investment round.

Brazilian purchases in 2021

Brazilians increased their spending on psychologists, pet services and vehicle-related expenses in 2021. The balance was made by Itaú with purchases made on their cards and sales made through Rede’s machines.

In numbers: both the total value of transactions and the number of transactions grew by about 25% compared to 2020. Online shopping, which boomed in the first months of the pandemic, represented 21.1% of the total in 2021 – they were 18% in 2019.

Highlights:

• Spending on psychologists has increased 40% compared to 2020, while parking, toll, car wash and oil change expenses increased by around 50%.
• The petshop and vets sector has grown 25.5% in the year. THE sheet showed last year that the Brazilian market –the third largest in the world– moved BRL 40.8 billion in 2020, more than the white goods sector (stoves, refrigerators, washing machines, etc).

In-person services: the purchase data show how the advance of vaccination last year encouraged Brazilians to return to the streets and travel.

Food and health and well-being (hospitals, doctors, veterinarians, etc.) 30%, and tourism services and gas stations advanced about 50% in 2021.