Vale and steel stocks fall more than 2% on ore; 4 of the 7 debuts on the Ibovespa go up to 2%

SAO PAULO – In a session of reduced volume due to the holiday in the United States, the Ibovespa falls again, taking off from stock exchanges in Europe and Asia, with emphasis on shares of mining and steel companies, with losses of more than 2%.

The roles of Vale (active=VALE3]), CSN (CSNA3), Usiminas (USIM5) and Gerdau (GGBR4) all fall between 1% and 2.3%, driven by the collapse of iron ore in China. Commodity futures contracts traded on the Dalian exchange fell by 6.65%, quoted at US$ 111.97, its lowest value in seven months.

The retreat comes amid recent moves by China to limit steel volumes for the rest of the year. In the latest move, Handan city officials announced restrictions that run until the end of October, according to the government’s website. The rules, which include closing some furnaces, could reduce the city’s steelmaking capacity by 8.6%, estimates consulting firm Mysteel.

Also pay attention to the change in the Ibovespa, which now has 91 shares in its portfolio, with the entry of 7 new shares as of today. Of the new products, Banco Inter PN (BIDI4), Banco Pan (BPAN4), Méliuz (CASH3) and Rede D’Or (RDOR3) registered expressive gains, of around 2%, while Alpargats (ALPA4), Petz (PETZ3) and Dexco , ex-Duratex (DXCO3). retreat.

The roles of meatpackers are among gains and losses with attention to the news involving the suspension of meat exports to China after the Ministry of Agriculture confirmed on Saturday the occurrence in Brazil of two atypical cases of the well-known Bovine Spongiform Encephalopathy (BSE) disease like “mad cow”.

Despite this, analysts at Bradesco BBI, the news is unlikely to have a major impact on the valuation of protein companies, with expectations that exports will resume soon. Marfrig (MRFG3), Minerva (BEEF3) and JBS (JBSS3) turned slightly higher after opening to the downside.

Among the highs, one of the best stocks on the Ibovespa in the year, WEG (WEGE3) appears among the biggest highs of the day, rising more than 1%. In the company’s news, Citi started covering the shares with a purchase recommendation and a target price of R$50.

Analysts say the company combines a strong track record of growth, cash flow generation and strong potential with vehicle electrification and renewable energy. According to them, WEG has 60% of its sales outside Brazil, but a small market share, which with the devalued real, increases its competitiveness.

Check out the highlights:

Vale (VALE3) and steel mills

Environmental restrictions and greater supply worsen the scenario for iron ore and bring down prices in the futures market.

The commodity contract fell to less than $130 a tonne amid recent moves by China to limit steel volumes for the rest of the year. In the latest move, Handan city officials announced restrictions that run until the end of October, according to the government’s website. The rules, which include closing some furnaces, could reduce the city’s steelmaking capacity by 8.6%, estimates consulting firm Mysteel.

Read more: More restrictions on steel production in China bring down ore

“Restrictions on steel production are likely to intensify, and mills are adopting a wait-and-see attitude, unwilling to buy,” said CITIC Futures analyst Zeng Ning. Exports from Australia have increased, he said, and foreign sales from Brazil reached a record for the month of August. Iron ore stocks at China’s ports rose for a third week to the highest level since April, according to Steelhome.

Credit ratings agency Moody’s on Friday upgraded steelmaker CSN’s rating from Ba3 to Ba2, citing the improvement in the company’s liquidity and leverage profile in recent months. Among the reasons for the decision, Moody’s cited CSN’s cash position of R$22.2 billion at the end of June, a figure that rises to R$25.3 billion if it includes the shares it holds in Usiminas.

The agency also mentioned in the report CSN’s initiatives to increase financial liquidity, including the R$4 billion initial public offering (IPO) of the subsidiary CSN Mineração.

Refrigerators

The Ministry of Agriculture confirmed on Saturday the occurrence in Brazil of two atypical cases of Bovine Spongiform Encephalopathy (BSE), known as “mad cow”, which triggered the temporary suspension of beef exports to China from that date, said the folder in a statement. One of the cases was identified in a slaughterhouse in Nova Canaã do Norte (MT) and the other in Belo Horizonte (MG), the ministry said.

The suspension of exports went into effect from Saturday, until the Chinese authorities conclude the evaluation of the information already passed on about the cases.

These are the fourth and fifth atypical cases of mad cow identified in the country in more than 23 years of surveillance for the disease. Brazil has never registered the occurrence of a classic BSE case, the ministry pointed out. The folder said that, after confirming the diagnosis on Friday, Brazil officially notified the World Organization for Animal Health (OIE), as provided for by international standards.

For Bradesco BBI, the news should not have a major impact on the evaluation of protein companies. “Although Brazil has suspended beef exports to China, as required by the trade agreement, we expect these restrictions to be lifted soon, as these cases have been confirmed as atypical,” analysts say, recalling that, in 2019, when Brazil had unusual cases of mad cows, beef exports to China were suspended for just 13 days.

Bank of Brazil (BBAS3)

Banco do Brasil said on Friday that it has given up on disassociating itself from the entity that represents the country’s major banks, Febraban, in the wake of a malaise last week with the content of a manifesto calling for harmony between the Powers of the Republic.

The announcement comes after Febraban reaffirmed its support for the manifesto the night before, respecting the opposing positions of BB and Caixa Econômica Federal and distancing itself from the movement led by Fiesp, from São Paulo’s industries. The manifesto, also signed by other sectorial entities, called for harmony between the Powers, and displeased President Jair Bolsonaro, who has had frequent clashes with members of the STF.

Petrobras (PETR4)

On Friday, Petrobras started a campaign to clarify the price of gasoline, which at some stations in the country is already close to R$7 per liter, according to company sources told the international news agency Reuters.

In a video, which will initially be released on Petrobras channels, but should become a publicity piece, the company will show that it receives only R$ 2 of the sale value at the pumps at the gas stations, according to sources told Reuters. They asked not to be named. The piece will highlight the weight of the state tax, the ICMS, in the formation of the final price of gasoline, which is criticized by President Jair Bolsonaro.

Méliuz approved at the Extraordinary General Meeting (AGE) on Friday (3) the split of all its shares, in the proportion of 1 to 6, without changing the value of the company’s share capital.

The company’s shares will be traded split from September 9th, and the shares resulting from the operation will be credited to shareholders until September 13th.

The company pointed out that the asset division operation did not result in leftovers resulting from fractional shares.

The papers resulting from the Méliuz split “will grant their holders the same rights as the existing common shares, including in relation to the distribution of dividends and/or interest on equity and any capital remuneration that may be distributed by the company”, stated the company, in a statement.

Being Educational (SEER3)

On Friday, the education group Ser Educacional announced an agreement to acquire Starline Tecnologia SA, owner of the Prova Fácil platform, entering the test management market. All EdTech executives will continue to lead Prova Fácil and will also have the financial and strategic support of Ser Educacional, the company added.

Brisanet (BRIT3)

Bradesco BBI began coverage of Brisanet, with an outperform evaluation and a target price for 2022 of R$17, compared to the price of R$11.9 on Friday. The bank says that Brisanet is the largest provider of internal internet services (ISP) in Brazil, and is mainly focused on the Northeast of Brazil, where the company already has a strong presence, with 14% of accesses in the region. , second only to Oi, with 16%. Brisanet is a leader in the optical fiber segment.

The bank says that the Northeast still has low fiber optic penetration in relation to other regions, only 29% of households, and Brisanet is efficient in investing, which supports its expectation of profitable expansion. The bank maintains an outperform evaluation and a target price of R$17, compared to the quotation of R$11.9 on Friday.

The technology provider for the financial system Sinqia on Thursday priced a restricted share offering with primary distribution at R$23 per share, totaling R$400 million. The fixed price came out with a discount of around 1% in relation to the share’s closing quote on Thursday, of R$23.27. According to a material fact, after the offering, the company’s new share capital will increase to R$813.3 million, divided into 87,941,972 common shares.

CCR announced on Friday that Andrade Gutierrez sent the letter to the other shareholders of the company’s controlling block, giving them a period of 30 days to exercise or not the preemptive right to acquire the entire share of the group in the company.

In addition to Andrade Gutierrez, with a 14.86% stake in CCR, Grupo Soares Penido (15.05%) and Mover Participações (14.86%) are also part of the controlling group and signatories to the company’s shareholders’ agreement. ), formerly known as Camargo Côrrea.

Itaú BBA commented on Cosan’s announcement of the signing of a second round of investments through a private transaction with Compass. According to the company, the capital increase was carried out by Bradesco Vida e Previdência, BC Gestão de Recursos, Prisma Capital and Núcleo Capital, through an agreement that provides for the subscription of R$ 1.44 billion and the issuance of new shares that add up 7.68% of Compass value.

The transaction is based on a valuation of BRL 17.31 billion, which suggests the same valuation paid by Atmos Capital in the first capitalization, of BRL 810 million, announced by the company at the end of May 2021. With the two rounds, the Compass will have increased its share capital by R$ 2.25 billion, thus, Cosan’s stake in Compass will drop to 88%.

Itaú says it sees the deal as positive, capable of allowing Compass to continue to carry out its strategy, and indicates the benefit of Cosan’s holding strategy and its benefits. Itaú maintains an outperform valuation (perspective of appreciation above the market average) for Cosan, and a target price for 2021 of R$30, compared to Friday’s quotation of R$22.13.

Stone (NASDAQ: STNE)

On Friday, Itaú BBA held a videoconference with Stone’s management, with the presence of the vice president of finance and IRO, Rafael Martins, and with Marcos Reis, of the investor relations sector.

According to the bank, the management stated that the impact of the malfunctioning of the registration system for new receivables was exacerbated by other factors, such as low flexibility for the payment of debts and negotiations in a volatile pandemic scenario.

The company said it does not anticipate additional provisions in the second half, considering that the coverage rate is at healthy levels. The bank says it is too early to predict the speed of the company’s portfolio growth with the return of loan disbursements.

Itaú maintains an outperform valuation for Stone, and a target price of US$65, compared to the quotation of US$44.63 for STNE shares on Friday on Nasdaq.

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