Asian markets closed in the red, while New York futures indices operate close to stability on Thursday morning (18), after the minutes of the last meeting of the Federal Reserve’s Open Market Committee (FOMC, its acronym in English). (Fed) leave the monetary authority’s next steps open.
The US central bank said it remained committed to fighting inflation, but indicated that the intensity of monetary tightening will depend on economic indicators.
In that vein, investors expect the Fed to be able to slow the pace of its rate hikes after a July consumer price index (CPI) reading showed inflation had slowed a bit. But not all market participants are convinced.
In indicators, the numbers of weekly unemployment insurance claims and used home sales come out.
European stocks, on the other hand, operate without a defined direction, with investors reflecting the July Eurozone consumer price index (CPI), which grew 0.1% on a monthly basis and 8.9% on annual basis.
In Brazil, Roberto Campos Neto, president of the Central Bank, and Paulo Guedes, Minister of Economy, talk about economic prospects at a BTG event, while the domestic agenda of indicators is empty.
Check out more highlights:
1. World Scholarships
After the Dow Jones spot index broke a five-high streak in the previous session, US futures indexes operate in the red with investors positioning themselves awaiting the Fed’s next moves.
The minutes of the Fomc said that the monetary authority will monitor the next indicators of the economy, such as inflation, labor market and activity indices. Thus, it left the door open for adjustments that could be as aggressive as the last one, or softer, in the next encounters.
The Fed raised its interest rate in reference of one day in 2.25 Scores percentages noThis one year, for a range of 2.25% to 2.50%. After the release of the minutes, operators in contracts futures pegged to the Fed’s benchmark interest rate saw a rise of 0.50 percentage point as most likely in September.
“They stayed ‘hawkish’ (tough on inflation)but also opened the door perhaps to an increase in 0.50 percentage point in September, instead of 0,75 (Score)“, said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
On the corporate front, Kohl’s, Tapestry, Estee Lauder and Ross Stores report their results on Thursday. Applied Materials will also publish its quarterly update.
See the performance of futures markets:
- Dow Jones Futures (USA), -0.11%
- S&P 500 Futures (US), -0.12%
- Nasdaq Future (USA), -0.16%
Asia-Pacific markets closed lower also echoing the Fed’s minutes.
A highlight of the region’s monetary policy after raising rates by 50 basis points on Wednesday, Reserve Bank of New Zealand Governor Adrian Orr said on Thursday he was confident that inflation was falling.
Meanwhile, the Philippine central bank is meeting on interest rates and is expected to raise rates by 50 basis points.
In China, local media reports that local governments can sell more than $229 billion in bonds to finance infrastructure investments and boost the country’s economy. In the region, the US and Taiwan have started talks to create a trade deal, which could further heighten tensions with China.
- Shanghai SE (China), -0.46%
- Nikkei (Japan), -0.96%
- Hang Seng Index (Hong Kong), -0.80%
- Kospi (South Korea), -0.33%
European markets operate with no clear direction amid continued market caution about the inflationary outlook. The euro zone’s consumer price index (CPI) for July rose 0.1% month-on-month and 8.9% year-on-year, in line with the Refinitiv consensus.
- FTSE 100 (UK), -0.16%
- DAX (Germany), +0.29%
- CAC 40 (France), +0.23%
- FTSE MIB (Italy), +0.28%
Oil prices rise this Thursday (18), extending the gains of the previous session. The early morning had been a drop for prices, amid rising Russian production and worries about a possible global recession.
Russians have started to gradually increase oil production after sanctions-related restrictions and as Asian buyers ramped up purchases, prompting Moscow to raise its production and export forecasts through the end of 2025, a revised Economy Ministry document showed. by Reuters.
Dalian iron ore fell to a three-week low on Thursday, losing $100 a tonne, as steel ingredient prices operated volatile in Singapore, pressured by concerns over weak steel demand and rising steel demand. of supply in China.
A record heat wave that hit several regions of China, the biggest steel producer, caused power shortages, forcing authorities to ration electricity with residential use prioritized over industrial consumption. Iron ore inventories at the port in China at a three-month peak added pressure on prices, analysts at Huatai told Reuters.
- WTI Oil, +1.16%, at $89.13 a barrel
- Brent crude, up 1.36% at $94.92 a barrel
- Iron ore traded on the Dalian Exchange was down 3.96% to 678.50 yuan, equivalent to US$99.90
- Bitcoin, -1.50% to $23,457.30 (from 24 hours ago)
This Thursday (18), there will be a release of weekly unemployment insurance claims numbers and data on used home sales in the United States. In addition to these indicators, two Fed members spoke and were able to comment on the minutes of the Fomc published yesterday (17).
In Brazil, Roberto Campos Neto, president of the Central Bank, and Paulo Guedes, Minister of Economy, speak at a BTG event on macroeconomic perspectives.
10:00 am: Paulo Guedes, Minister of Economy, participates in the 23rd Santander Conference – Panel: Proposals for Brazil (closed to the press)
10:30 am: Roberto Campos Neto, president of BC, speaks at the event BTG Pactual – Macro Day 2022
11:30 am-11:40 am: BC starts this 5th rollover of US$ 15.6 billion in currency swaps
3:00 pm: Meeting of the National Monetary Council (CMN), by electronic means. (closed to press)
4pm: Guedes talks at the BTG Pactual event
6:30 pm: Datafolha electoral poll
Inside the Results – InfoMoney
O InfoMoney until August 19th, a series of interviews with CEOs, CFOs and other executives from publicly traded companies in Brazil will be held on the Por Dentro dos Results project. Check out the day’s agenda:
10am: interview with Milton Rangel, CFO of Prio (ex-PetroRio) (PRIO3)
3pm: interview with Daniela Sabbag, CFO, and Gabrielle Helu, DRI do Assaí (ASAI3)
5pm: interview with Jeane Tsutsui, CEO of Fleury (FLRY3)
9:30 am: Claims for weekly unemployment benefits, Refinitiv consensus points to 265,000 claims
9:30 am: Philadelphia Fed industrial activity index
11am: Used home sales
2:20 pm: Speech by Fed Director Esther George
2:45 pm: Speech by Fed Director Neel Kashkari
3. Zero tax on fuels in 2023
President Jair Bolsonaro (PL) said that he spoke last Wednesday with part of the economic team and guaranteed in the Budget the maintenance of zero federal taxes on gasoline, diesel, alcohol and cooking gas in 2023. Hotel Royal Tulip, in Brasília, the candidate for reelection stated that he is negotiating with the Ministry of Economy the possibility of also zeroing the federal taxes on aviation kerosene.
In recent months, the government has launched an offensive to reduce the tax burden on fuel. In addition to zeroing federal taxes, Palácio do Planalto sponsored a project in Congress, which has now become law, to establish a ceiling for ICMS, a tax levied by states on these products. On the eve of the election, the Legislature also approved a constitutional amendment that decreed a national emergency to enable the granting of new social benefits, such as the truck driver allowance and the taxi driver allowance, in addition to the expansion of the gas voucher and the Auxílio Brasil, from R $400 to $600.
Tax reform is enough to keep extra aid in 2023, says Guedes
Economy Minister Paulo Guedes said that, in order to maintain the extra R$200 aid next year, “it is enough to approve tax reform one day after the election”.
Still on the continuity of the benefit, Guedes said that one possibility would be to correct the limit for income tax exemption and tax profits and dividends.
The minister stated, during the Tag Investimentos forum, that until then the extra expenses, including those related to emergency aid, were covered by extraordinary income.
The National Civil Aviation Agency (ANAC) and B3 hold a virtual session of the concession auction of the 15 airports in the 7th round, grouped into three blocks: Block SP-MS-PA-MG, comprising Congonhas airports (SP); Campo Grande, Corumbá and Ponta Porã, in Mato Grosso do Sul (MS); Santarém, Marabá, Parauapebas and Altamira, in Pará (PA); Uberlândia, Uberaba and Montes Claros, in Minas Gerais (MG); General Aviation Block, formed by Campo de Marte (SP) and Jacarepaguá (RJ) airports; North Block II, integrated by the airports of Belém (PA) and Macapá (AP). The auction will take place at B3, in São Paulo, on August 18, at 2 pm.
Last Wednesday (17), Brazil recorded 246 deaths and 22,046 cases of covid-19 in 24 hours, according to information from the consortium of press vehicles, at 8 pm.
The moving average of deaths from Covid in 7 days in Brazil stood at 175, a reduction of 16% compared to the level of 14 days earlier.
The moving average of new cases in seven days was 17,930, which represents a decrease of 40% compared to the level of 14 days before.
The number of people fully immunized against Covid in Brazil reached 169,713,380, equivalent to 79% of the population.
The number of people who took at least the first dose of vaccines reached 180,427,570 people, which represents 83.99% of the population.
The booster dose was given to 101,390,639 people, or 47.2% of the population.
5. Corporate Radar
GPA’s Board of Directors (PCAR3) approved the execution of credit assignment agreements with financial institutions for the anticipation of receivables, in the amount of up to approximately R$ 2 billion referring to installments due by Assaí between 2023 and 2024 as a result of the onerous assignment of stores under the “Extra Hiper” banner by the company to Assaí.
The retailer expects the amount to be advanced by financial institutions to the company in up to three installments during the third quarter of 2022.
Based on the company’s quarterly information for the 2nd quarter, this anticipation of funds would reduce the company’s leverage of approximately 0.8x, from 1.9x to 1.1x.
Zamp (BKBR3), owner of BK Brasil
The Board of Directors of the Brazilian network operator fast food Zamp (BKBR3), former BK Brasil, expressed its opposition to the acceptance, by the company’s shareholders, of the voluntary public offer for the acquisition of common shares for the acquisition of control of the company.
On August 1, the fast-food chain had received a proposal to acquire control by a vehicle from UAE state investor Mubadala.
Mubadala Capital launched the takeover bid (OPA) aiming at the acquisition of 45.15% of the shares issued by the company, at a price of R$ 7.55 per share, so that, if the OPA is successful, Mubadala Capital will hold 50.10% of the share capital.
(With Estadão, Reuters and Agência Brasil)
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