Ibovespa Futuro rises with the exterior amid the reduction of fears with delta variant in China; future dollar falls

SAO PAULO – The Ibovespa Futuro opens on a high this Monday (23) with the recovery of the main global stock and oil indices after much concern last week with the monetary policy of the United States, the delta variant of the coronavirus and the environment regulatory framework in China. Brent barrel rises 3.22% to $67.28.

Earlier this week, news improved in the wake of the pandemic, and Chinese officials said there was no local case of Covid-19 for the first time since July, indicating a slowdown in the current wave. However, investors continue to monitor the advance of the delta variant.

Investors will pay attention to the Jackson Hole symposium, which begins on Thursday (26) and should bring more signals on the pace of the reduction in monthly bond purchases carried out by the Federal Reserve and also on when the members of the monetary authority of the United States they hope to start a cycle of rising interest rates.

Around here, governors will meet to discuss the institutional crisis. After President Jair Bolsonaro presented to the Senate the impeachment request of Minister Alexandre de Moraes, of the Federal Supreme Court (STF), São Paulo Governor João Doria said that Brazil’s democracy has never been so threatened since the 1964 coup .

At 9:10 am (Eastern time), the Ibovespa futures contract maturing in October 2021 was up 0.38%, to 119,350 points.

The dollar futures maturing in September registered a drop of 0.23% to R$5.37.

In the futures interest market, the DI for January 2022 rises two basis points to 6.71%, the DI for January 2023 rises by one basis point to 8.41%, the DI for January 2025 advances two basis points at 9.58% and DI for January 2027 operates stable at 10.01%.

Also on the Fed, Dallas monetary authority chairman Robert Kaplan, a well-known “hawk” (tougher positioning authority), shook expectations of monetary tightening on Friday, saying he may reconsider the need for an early start. monetary tightening if the coronavirus harms the economy.

In Europe, the Markit Purchasing Manager’s Index (PMI) composed for the Eurozone, which brings data on the services and manufacturing sectors, registered the lowest level in two months in August, at 59.5 points, compared to 60.2 points. Any plateau above 50 points indicates expansion; below, retraction.

Germany’s composite PMI fell from 62.4 in July to 60.6 in August, according to preliminary data released on Monday, 23, by IHS Markit. Despite the drop, a reading well above the 50 mark shows that activity in Europe’s largest economy continues to expand at a strong pace this month, albeit more contained.

The UK composite index, meanwhile, fell from 59.2 in July to 55.3 in August, reaching its lowest level in six months, according to preliminary data released today by IHS Markit in partnership with CIPS. Despite being above 50, the preview of August was well below the expectations of analysts consulted by the Wall Street Journal, who predicted a marginal retreat of the indicator to 59.

Focus report

The projections of financial market economists for the Extended National Consumer Price Index (IPCA) in 2021 were raised once again, showed the Focus Report of the Central Bank. This week, the median of expectations for the official inflation meter rose from 7.05% to 7.11% in 2021. For 2022, in turn, forecasts were raised from 3.90% to 3.93%.

In relation to the Gross Domestic Product (GDP), projections fluctuated downwards once again, falling from 5.28% to 5.27% in 2021 and from 2.04% to 2.00% in 2022.

Regarding the dollar, forecasts were maintained that the US currency will end the year quoted at R$ 5.10 and end 2022 quoted at R$ 5.20.

Finally, the median of estimates for the basic interest rate, Selic, remained at 7.50% per annum for both 2021 and 2022.

covid

On Sunday (22), the moving average of deaths by Covid in 7 days in Brazil was 765, down 16% compared to the level of 14 days before. In just one day, 331 deaths were recorded. The information comes from the consortium of press vehicles that systematizes data on Covid collected by Health Secretariats in Brazil, which announced, at 8 pm, the progress of the pandemic in 24 hours.

The moving average of new cases in seven days was 29,490, which represents a drop of 8% compared to the level of 14 days before. In just one day, 14,178 cases were registered.

The number of people who received the first dose of the vaccine against Covid in Brazil reached 122,830,226, equivalent to 58.01% of the population. The second dose or the single dose vaccine was given to 55,068521 people, or 26.01% of the population.

Request for impeachment of Moraes and LDO 2022

Investors are monitoring the new focus of political crisis, after President Jair Bolsonaro joined, in the late afternoon of Friday (20), with a request for impeachment against Minister Alexandre de Moraes, of the STF, in the Federal Senate.

The piece sent to the Senate, however, should not prosper, in the opinion of senators and consultants, and even the president of the House, Rodrigo Pacheco (DEM-MG), who is responsible for whether or not to proceed with the process, has already stated that it will not identifies criteria that justify the removal from office of the STF minister.

“I honestly do not foresee technical, legal and political grounds for the impeachment of the Supreme Minister, nor do I foresee the impeachment of the President of the Republic,” the senator told journalists, arguing that the episode of the presentation of the impeachment request will have to be “overcome”.

President Jair Bolsonaro filed a lawsuit in the Federal Supreme Court (STF) on Thursday night asking for the annulment of an article in the court’s internal regulations that allows the opening of official inquiries – without a request from the Federal Public Ministry, as it was the case of the Fake News inquiry.

The Allegation of Non-Compliance with Fundamental Precept (ADPF), presented by the Attorney General’s Office on behalf of the president, asks that article 43 of the bylaws be suspended in an injunction until it is judged by the full court of the STF.

The allegation is that the use of the article of the bylaws to open investigations violates constitutional precepts and “the fundamental rights of the accused in the inquisition procedures derived from it”.

The inquiry targeted by the president was opened in March 2019, ex officio, by the then president of the court, Dias Toffoli, to investigate false news and constant attacks on members of the STF. Minister Alexandre de Moraes, was appointed as rapporteur, and became one of the targets of Bolsonaro’s fury.

Moraes was also responsible for receiving news-crime against Bolsonaro for leaking confidential investigation information from the Federal Police.

Also highlighted, Bolsonaro on Friday sanctioned the Budget Guidelines Law (LDO) for 2022, but vetoed the part of the proposal that increased the amount to be transferred to the electoral financing fund.

When voting on the LDO, lawmakers modified the rules for the Special Fund for Campaign Financing, increasing the amount to be transferred to the fund from R$ 2 billion to R$ 5.7 billion.

Among the sanctioned points are goals and priorities established by the LDO for the preparation of next year’s Budget, such as the primary deficit target of R$ 170.47 billion for the Fiscal and Social Security Budget and a deficit of R$ 4, 42 billion for state companies, informed a note from the Special Office of Social Communication of the Presidency of the Republic.

The sanctioned part of the LDO considers as a macroeconomic parameter real GDP growth for the year 2022 of 2.5%, the IPCA at 3.5%, the Selic rate at 4.74% and the average exchange rate at R$ 5 .15 per dollar.

The LDO also provides for a minimum wage of R$1,147 in 2022 as a guideline, but the effective amount needs to be established by provisional measure. Items referring to the amendments of the standing committees and the amendments of the General Rapporteur for the Budget were also partially vetoed.

According to the cover story published this Monday by the newspaper The globe, lawmakers are now starting to articulate themselves to ensure at least R$4 billion for campaigns, which would be more than double the R$1.7 billion allocated to parties in the 2018 general elections. If there is no agreement, the overthrow presidential veto is an alternative studied by congressmen, the newspaper says.

corporate radar

On the corporate radar, EZTec reported on Friday that its board of directors has approved a buyback program of up to 5,035,897 shares. BR Properties, on the other hand, announced that it had ended its share buyback plan.

The governor of São Paulo, João Doria (PSDB), said on Saturday that Sabesp will be prepared to be privatized in the coming years, and that the government will not do anything rashly.

EzTec (EZTC3)

EZTec said on Friday that its board of directors has approved a repurchase program of up to 5,035,897 shares.

The program has a term of up to six months, ending on February 23, 2022. The amount referred to is equivalent to approximately 5% of the company’s shares outstanding in the market.

BR Properties (BRPR3)

BR Properties announced that it had ended its share buyback plan. He obtained 99.95% of the assets he had proposed to buy, with 10,994,600 shares being acquired for R$ 94.888 million, with an average cost per share of R$ 8.63.

Minerva (BEEF3)

A unit of Minerva Foods in Palmeira de Goiás (GO) was searched and seized by the Federal Police (PF) as part of Operation A Posteriori, which investigates alleged irregularities of federal agricultural tax auditors in the period 2018 to 2019, the company informed in this Friday.

According to the company, the procedure, carried out on the farm, had the cooperation of Minerva employees and the plant maintains its regular activities. “There is no indictment or accusation against the company, against its administrators or any of its employees or collaborators within the scope of the operation,” he said in a statement.

Sabesp (SBSP3)

The governor of São Paulo, João Doria (PSDB), said on Saturday that Sabesp will be prepared to be privatized in the coming years, and that the government will not do anything rashly.

Commenting on statements by the newly appointed secretary of Projects and Strategic Actions of São Paulo, federal deputy Rodrigo Maia (no party-RJ), on the privatization of Sabesp, Doria stressed that the privatization of the sanitation company is a “long-term project” term”, not short term.

“Our government is privatizing… Sabesp is already publicly traded, listed on the stock exchange, with very good performance and well managed. Over the next few years, it will evidently be prepared for a privatization program, but we will not do it rashly”, commented Doria to journalists in Rio de Janeiro. Maia’s statements made Sabesp’s actions soar on Friday.

Braskem (BRKM5)

Braskem announced that it is not aware of the holding of a public offering of the company’s shares as a possible exit strategy for shareholders, in a clarification after the Broadcast column.

The company says that “it is not part of any discussions by its shareholders about the sale of their shareholdings”, according to a statement sent to the Brazilian Securities Commission (CVM), as a clarification of news published in the media.

IPOs

Victoria-based cybersecurity firm ISH Tech has filed for an initial public offering (IPO) in search of funds to finance its organic growth and acquisitions, as well as investing in research. The company was founded in 1996 as an IT consultancy.

(with Reuters and Estadão Content)

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