US futures rise on return to holiday; Copom Minutes and more market issues today

New York and European stock futures indexes rise, in the same direction as most Asian markets closed on Tuesday (21), with investors evaluating a more aggressive Federal Reserve (Fed) and the growing chances of recession.

The positive move in global markets appears to be staging a recovery after a tumultuous week last week.

Wall Street returns from the Juneteenth holiday with a strong rise after a last week of strong decline. Tuesday has no relevant indicators on its agenda, reserving for tomorrow the important testimony of Jerome Powell in the Chamber. His speech comes after a recent interest rate hike by 0.75 percentage points, the biggest increase by the US central bank since 1994.

US investors will monitor incoming data, including existing home sales on Tuesday, to gauge the health of the economy. Recent data showing low consumer confidence, falling retail spending and a cooling housing market have fueled recession fears as the Fed battles inflation at 41-year highs.

In Brazil, the Copom minutes (8:00 am) will be released, which should give clues about the end of the Selic tightening cycle, which may be associated with the reasons that led the BC to put its projection for the 2024 IPCA in the communiqué. The suspicion is that it is starting to give up on next year’s target, because pursuing an inflation of 3.25% would have a very high cost for the economy.

On the political side, last night the President of the Republic, Jair Bolsonaro, once again defended the creation of a Parliamentary Commission of Inquiry (CPI) to investigate Petrobras. The Chief Executive has been in favor of the initiative after the announcement of yet another increase in fuel prices.

1. World Scholarships

United States

US futures indexes operate higher on Tuesday (21), after a week of heavy losses, with investors assessing a more aggressive Fed and increasing chances of recession.

Major indices suffered their 10th losing week out of 11 last week on fears the central bank will aggressively raise rates to tame inflation at the risk of causing an economic slowdown.

See the performance of futures markets:

  • Dow Jones Futures (USA), +1.67%
  • S&P 500 Futures (US), +1.88%
  • Nasdaq Future (US), +2.04%

Asia

Most markets in Asia-Pacific closed with gains in today’s session (21), with the exception of the Shanghai index in China.

Meanwhile, Reserve Bank of Australia Chairman Philip Lowe said he expects inflation in Australia to peak at around 7% by the end of the year as pandemic-related supply chain disruptions resolve. .

  • Shanghai SE (China), -0.26%
  • Nikkei (Japan), +1.84%
  • Hang Seng Index (Hong Kong), +1.87%
  • Kospi (South Korea), +0.75%

Europe

European markets operate higher on Tuesday, continuing the recovery seen earlier in the week.

The mainland trades come as global markets appear to be staging a rebound after a tumultuous week last week.

  • FTSE 100 (UK), +0.60%
  • DAX (Germany), +1.12%
  • CAC 40 (France), +1.83%
  • FTSE MIB (Italy), +1.02%

commodities

Oil prices rose on Tuesday, recouping losses from last week, with the focus on tight supplies of crude and fuel products versus worries about a recession hitting future demand.

  • WTI Oil, +2.22%, at $110.39 a barrel
  • Brent crude, up 1.36% at $115.68 a barrel
  • Iron ore traded on the Dalian Exchange was down 3.10% to 749.00 yuan, equivalent to US$111.86

Bitcoin

  • Bitcoin, +4.00% to $21,352.60 (from 24 hours ago)

2. Schedule

Today, attention to the minutes of the last meeting of the Monetary Policy Committee (Copom) – which raised the Selic by 0.5 point, to 13.25% per year. In the communiqué that accompanied the announcement of the decision, the Central Bank projected a new adjustment in the basic interest rate of equal or lesser magnitude. The minutes should bring new information about its upcoming decisions and the Selic terminal point.

The committee’s view of the scenario will also be further clarified at a press conference on monetary policy on Thursday, June 23, points out Itaú (the complete Quarterly Inflation Report will be released on June 30).

Brazil

8:00 am: Copom Minutes

9:30 am: Roberto Campos Neto, president of the BC, has a conference call with Agustín Carstens, General Manager of the Bank for International Settlements – BIS, to discuss institutional matters, in São Paulo. (closed to press)

10:00 am: Campos Neto meets with members of the Fitch Ratings agency. (closed to press)

10:30 am: Auction of bonds

USA

9:30 am: Fed Chicago National Activity Index

11 am: Sale of used houses

4:30 pm: Speech by Richmond Fed Chairman Thomas Barkin

3. fuels

Arthur Lira, president of the Chamber, is expected to hold new meetings with the leaders of the allied base and opposition parties today to address the week’s voting agenda and the fuel issue. The opposition is due to meet with Lira today at 8:30 am. The grassroots parties will meet you at lunch at 12:00.

Lira met yesterday (20) with party leaders from the Chamber, in a meeting that lasted approximately four hours. In the end, she demanded a more direct participation from the federal government and, mainly, from the Ministry of Economy, in the search for solutions for the high fuel prices.

Petrobras Policy

The Chief of Staff, Ciro Nogueira, said he was against a change in Petrobras’ pricing policy. In an interview with Valor, however, he defended that the company implement “transition mechanisms” to face the fuel price crisis.

CCJ approves PEC that makes biofuels competitive

The Committee on Constitution and Justice and Citizenship (CCJ) of the Chamber of Deputies approved, last Monday, the admissibility of the Proposal for Amendment to the Constitution (PEC) 15/22, authored by the Senate, which seeks to stimulate the competitiveness of biofuels in in relation to fossil fuels. The PEC predicts that clean energy sources will have benefits for at least 20 years.

The proposal is part of a package of measures voted on by lawmakers to contain the rise in fuel prices.

4. Covid

Last Monday, Brazil recorded 108 deaths and 55,733 cases of covid-19 in 24 hours, according to information from the consortium of press vehicles, at 8 pm.

The moving average of Covid deaths in 7 days in Brazil stood at 141, an increase of 47% compared to the level of 14 days earlier.

The moving average of new cases in seven days was 37,298, which represents an increase of 6% compared to the level of 14 days before.

The number of people fully immunized against Covid in Brazil reached 167,022,862, equivalent to 77.75% of the population.

The number of people who took at least the first dose of vaccines reached 178,863,406 people, which represents 83.26% of the population.

The booster dose was given to 98,105,862 people, or 45.67% of the population.

5. Corporate Radar

Eletrobras (ELET3; ELET6)

Eletrobras (ELET3; ELET6) paid the amount of R$ 26,635,960,067.14, referring to the amount due as a bonus for granting new electricity generation concession contracts, within the scope of its privatization process.

The state-owned company also informed that BNDESPar, a wholly-owned subsidiary of BNDES, sold 69,801,516 ON shares held by the electric company within the scope of the Global Public Offering by the electric company. The sale, together with the dilution resulting from the primary tranche of the aforementioned offer, caused BNDESPar to surpass, downwards, the level of 5% of the total ON shares issued by Eletrobras.

Hi (OIBR3)

Oi (OIBR3) postponed the release of its financial results for the first quarter of this year (1Q22) to June 28th. However, the company anticipated preliminary revenue of R$ 4.383 billion.

The company’s preliminary routine Ebitda reached R$ 1.128 billion in the period, an increase of 8% compared to the same quarter of 2021.

The company informed that among the reasons for the postponement are the complexity of the work of segregation of assets in the three SPEs that integrate the UPI Ativos Móveis and the need to obtain the opinions of the independent auditors for the respective financial statements of the three SPEs and the conclusion of the sale of UPI Ativos Móveis and the sale of control of UPI InfraCo.

MRV (MRVE3)

MRV (MRVE3) approved the distribution of dividends in the amount of R$95.5 million, equivalent to R$0.197808371 per share. The earnings will be credited on July 5th, based on the shareholding position on June 23rd.

Saint Martin (SMTO3)

São Martinho (SMTO3) recorded net income of R$ 225.4 million in the fourth quarter of the 2021/22 crop year, an increase of 8.7% compared to the same period in the previous year.

The company will pay interest on equity (JCP) in the amount of R$115 million, or R$0.33 per share.

(With Estadão, Reuters and Agência Brasil)

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About Yadunandan Singh

Born in 1992, Yadunandan approaches the world of video games thanks to two sacred monsters like Diablo and above all Sonic, strictly in the Sega Saturn version. Ranging between consoles and PCs, he is particularly fond of platform titles and RPGs, not disdaining all other genres and moving in the constant search for the perfect balance between narration and interactivity.

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