Markets rehearse recovery after sharp fall; commodities are highlighted in Brazil

Global markets rehearse a recovery this Friday morning (18) after yesterday’s sharp drop. In the domestic scene, commodities are featured on the stock market.

Starting abroad, US futures operate on the positive. The climate of geopolitical tension eased after US Secretary of State Antony Blinken agreed to hold a meeting with Sergey Lavrov, Russia’s foreign minister next week, as long as Russia does not invade Ukraine.

The exchange of fire between Ukrainian forces and pro-Moscow rebels in eastern Ukraine sent US stocks crashing yesterday: the Dow Jones Industrial Average had its biggest daily drop since late November. The S&P 500 is down more than 2% and the Nasdaq is down 2.9%.

In addition to Ukraine, the market is keeping an eye on US interest rates. James Bullard, a member of the Federal Reserve System (FED) – the American central bank -, said he does not believe that interest rate hikes do not raise the risks of recession and again defended a 1 percentage point hike in interest rates until July.

In Europe, stocks operate close to stability reflecting the promise of dialogue between Russia and the United States. On the positive side, Renault’s strong result brings some cheer to European indices.

In Asia, the indices closed mixed, driven by yesterday’s scenario of greater risk aversion.

Brazil

In Brazil, the stock market closed down yesterday, after seven consecutive highs.

Commodities had been helping the Ibovespa to rise, taking off from the fall abroad, but just yesterday commodities made the Ibovespa fall, with oil falling in the face of the prospect of extra supply from Iran and with iron ore falling with interventions by the Chinese government.

In the political scenario, it is worth noting that the rapporteur of the Proposed Amendment to the Constitution (PEC) 110, on tax reform, said that I saw the proposal’s opinion present next week. PEC 110 is the proposal that unifies taxes creating the dual VAT.

The rapporteur of the proposal that creates a fuel stabilization fund, Senator Jean Paul Prates (PT), presented a new opinion on the project. In this new opinion, he maintains the import tax. He is also the rapporteur of the proposal that provides for the establishment of ICMS, and a new opinion is also awaited on this proposal.

According to Arthur Lira (PP), president of the Chamber of Deputies, the ICMS and stabilization fund proposals are more likely to pass than the broader PECs and may be voted on next week.

For market analysts, even if the export tax is displeased, the signal is positive as the PECs predicted more revenue loss and could increase fiscal risk.

Indexes

The futures Ibovespa rose 0.37% with 115,522 points. The dollar dropped 0.15% to R$5.15 and the S&P futures rose 0.47%.

Agenda of the Day

In Brazil, there are no relevant indicators.

In the Euro zone, the consumer confidence index should come out in the morning. In the United States, highlights include data on used home sales in the morning and speeches by Fed members in the afternoon.

Source: CNN Brasil

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