Ibovespa closes with a drop of 0.91%, with weight of Petrobras (PETR4) and Vale (VALE3); Dollar closes almost stable

The Ibovespa closed down 0.91% this Monday (1), at 102,255 points. The main index of the Brazilian stock exchange was impacted by the negative performance of the shares of the commodities companies, as well as by the decline of the benchmarks americans.

In New York, the Dow Jones, S&P 500 and Nasdaq were down 0.14%, 0.28% and 0.18%, respectively.

“The day abroad was slightly negative, with a small correction movement from the recent high. It’s normal,” explains Felipe Moura, an analyst at Finacap Investimentos, noting that July was the best month for American stock exchanges since November 2020.

American risk assets retreated even on a day marked by the fall in treasuries yields, which usually leads to a flow of capital to the stock exchanges, mainly for technology companies. The 10-year treasury bond saw its rate fall by 4.5 basis points to 2.597%, the lowest level since the beginning of April.

“It is a reflection of recent data releases. Today we had Markit and ISM PMIs coming in below consensus. There was also the release of construction spending in the United States, which surprised in a very negative way”, comments Luciano Costa, chief economist and partner at Monte Bravo Investimentos “Although they do not confirm the fears of recession, these data bring the prospect of a economy settling on the margin”.

In June, in the US, construction spending dropped 1.1%, compared to an increase of 0.2% expected in the consensus. Markit’s Industrial PMI for July, meanwhile, brought a reading of 52.2, compared to an expected 52.3.

According to the expert, the decline in the American yield curve also helped to remove pressure from the Brazilian curve. The DIs for 2023 had their yields falling one basis point to 13.79%. The contracts for 2025 and 2027, in the middle of the curve, both had their rates falling 13 points, to 12.59% and 12.49%. In the long end, the DI for 2029 had its yield retreating 12 points, to 12.61%, and the one to 31, 14 points, to 12.65%.

“The release of the IPC-S also took pressure off the Brazilian yield curve, which brought deflation above the expected percentage”, includes Moura. “We had a considerable price decline, mainly in the transport part, due to the recent drops in fuel prices”.

In the fourth week of July, the IPC-S fell 1.19%, compared to a high of 0.67% in June.

For the specialist, all this combo, added to the news that Petrobras (PETR3;PETR4) will advance dividends, are responsible for the improvement in reading – and put on the table the chance that the Brazilian Central Bank will end the cycle of high interest rates already in meeting of the Monetary Policy Committee (Copom) this week.

The biggest rises on the Ibovespa today were from companies directly linked to interest rates, such as retailers and technology companies. Magazine Luiza (MGLU3) and Locaweb (LWSA3) common shares rose 5.43% and 5.02%, respectively.

Finally, the decline in commodity prices also helped to take pressure off the curve, with the Brent barrel, for example, falling 3.84% to US$ 99.98.

This retreat, however, weakened the real slightly against the American currency, with the commercial dollar rising 0.08%, to R$5.178 in the purchase and to R$5.179 in the sale – even with the DXY, which measures the strength of the dollar against other currencies. currencies, having retreated 0.50%.

“Exchange rate was volatile during the day, closing slightly higher. We had a lower-than-expected China PMI, with a sign of production cooling and new orders. This takes away a little, in the short term, the logic of more intense recovery there, after the already weaker second quarter”, opens Costa. “Weaker data in both the US and China generate some decrease in gains with commodities, which affects Brazil, which is a major exporter of these products”, he points out.

Vale’s common shares (VALE3) fell 2.39%. Petrobras’ common and preferred shares (PETR3;PETR4) fell, respectively, by 1.25% and 1.38%. The two companies were the main declines by weight of the Ibovespa.

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