© Reuters. B3 10/28/2021 REUTERS/Amanda Perobelli
By Paula Arend Laier
SAO PAULO (Reuters) – The index retreated sharply on Friday, losing the level of 100,000 points for the first time since November 2020, without alleviating concerns about the effects of monetary policy measures on world economic activity.
At 11:16, the Ibovespa dropped 3.2%, to 99,521.37 points, the lowest intraday level since November 5, 2020. The financial volume totaled 7 billion reais.
Part of the sales on the Brazilian stock market reflected adjustments to strong losses on Wall Street the day before, when there was no trading on the Brazilian stock market for the Corpus Christi holiday.
On Wednesday, the Ibovespa came to experience a truce and closed higher, after a sequence of eight sessions of decline, in the biggest negative series since 2015.
“Global equity markets remain highly volatile due to the monetary tightening signaled by major central banks,” said the team at XP Investimentos (SA:), in a report to clients this Friday.
“With many central banks raising rates on a timely basis, most market participants predict a global recession sometime in the next 12 months.”
Not even the improvement of the North American stock exchanges in this session was enough to mitigate sales on B3 (SA:). After closing down more than 3% the day before, it rose 0.5% on Friday morning.
“In the current environment, without a slowdown in inflation, we will have to live with a slowdown at the same time when inflation is high and monetary policy cannot be used as ‘insurance’ or ‘support’ for the economy and markets”, evaluates TAG’s investment director, Dan Kawa.
“The market is moving away from the ‘pure’ inflation narrative and pricing a recession more sharply,” he added in a customer comment.
– PETROBRAS PN (SA:) was down 5% on the back of a sharp decline in overseas prices, even after announcing average sales price increases for gasoline by more than 5% and diesel by more than 14%, effective from Saturday.
– VALE ON (SA:) lost 4.5% as prices extended losses for a sixth session on the Dalian Exchange on Friday, marking the sharpest weekly drop in four months.
– ITAÚ UNIBANCO PN (SA:) recorded a drop of 1.9% and BRADESCO PN (SA:) had a decrease of 1.55%, contaminated by the more selling bias on the stock exchange as a whole.
– GOL (SA:) PN and AZUL PN (SA:) dropped 6.2% and 5.9%, respectively, against the backdrop of the strong rise in the value of the Brazilian real this Friday.