Ibovespa closes at a maximum of 1.9% and reaches a higher level since September 9; dollar rises to R $ 5.61

SÃO PAULO – Ibovespa closed higher on Tuesday (20) and returned to its highest level in almost two months after the performance of international stock markets. The Dow Jones Index rose 0.4% to 28,308 points, the S&P 500 rose 0.47% to 3,443 points and the Nasdaq advanced 0.33% to 11,516 points.

After falling the previous day, the United States stock markets rose again on optimism about the possibility of an agreement between Republicans and Democrats for a stimulus package.

Today is the deadline for the ultimatum offered by the Speaker of the US House of Representatives, Nancy Pelosi.

A spokesperson for Pelosi said the differences were narrowing in the negotiations. The Speaker of the House of Representatives and the Secretary of the Treasury of the United States, Steven Mnuchin, today make another attempt to reach an agreement. During the afternoon, Pelosi said she was optimistic that Democrats could reach a deal with the White House that could offer help starting next month, further encouraging markets.

Here, it was bank stocks that pulled the benchmark, reflecting expectations that third-quarter results will be stronger (see balance sheet expectations by clicking here). Also, a report released by Credit Suisse on Sunday found that the outlook is more benign for provisions, although margins are still under pressure.

Itaú (ITUB4) increased 4%, Bradesco (BBDC3; BBDC4) increased 4.3% and Banco do Brasil (BBAS3) increased 4.6%. Together, the shares of the three banks represent 14.5% of the composition of Ibovespa’s theoretical portfolio. To see more featured stocks, click here.

The main index of B3 increased by 1.91%, to 100,539 points with a financial volume of R $ 25.09 billion. At most, the B3 main stock index reached 100,721 points.

With the gains of this Tuesday, the Ibovespa returned to its highest closing level since September 9, the day the stock market closed the session trading at 101,292 points.

Meanwhile, the commercial dollar rose 0.12% to R $ 5.61 in the purchase and R $ 5,611 in the sale. The US dollar maturing in November registered a slight negative variation of 0.03%, to R $ 5.61 in the Secondary market.

In the futures market, the ID of January 2022 fell five basis points to 3.23%, the ID of January 2023 fell 12 basis points to 4.53%, the ID of January 2025 fell 15 basis points in 6.33% and the DI of January 2027 registered a negative variation of 15 basis points at 7.24%.

Today in Europe, the alarming news about the new coronavirus remains a cause for concern. Ireland is preparing to institute its highest levels of restrictions, while Wales plans to initiate a national lockdown. On the positive side, the main companies listed on the continent’s stock exchanges reported good results.

Around here, Ambassador Robert O’Brien, Donald Trump’s security adviser, arrived in Brazil on Monday with the official program to sign agreements to combat corruption, good regulatory practices and trade facilitation.

Speaking to businessmen during a videoconference organized by Fiesp (Federation of Industries of the State of São Paulo), he also criticized China and criticized the Huawei company, interested in entering the 5G market in Brazil. The fight against the company is part of his agenda in the country.

And the supra-party organization CLP (Public Leadership Center) proposes, in alliance with Insper economist Ricardo Paes de Barros, a model to enable an income transfer program of R $ 27 billion to replace Bolsa Família and emergency aid, without drilling the spending ceiling.

US advisor against Huawei in Brazil

Ambassador Robert O’Brien, Donald Trump’s security adviser, leads a delegation that arrived in the country on Monday (19) with the official intention of participating in the approval of a new commercial package signed by Jair Bolsonaro (without a party) or President American.

The signing of three protocols is expected, aimed at: fighting corruption, good regulatory practices and trade facilitation. In the second, the representative has already signed an agreement to promote the bilateral flow of trade and investment.

But O’Brien is also expected to use the hearings on Tuesday (20) with Bolsonaro and Minister Augusto Heleno, from the Institutional Security Office, to seek to reduce China’s global influence in Brazil. The goal is to block Huawei from the 5G market, arguing that it would not offer security and privacy guarantees. He already spoke out against Huawei on Monday night.

In a videoconference with businessmen held at Fiesp (Federation of Industries of the State of São Paulo), O’Brien stated that “Brazil is a country of ‘high technology’, like Israel, Singapore, countries with aerospace, defense, mining and technology” , Valor reported. And that the US government is concerned “that China is turning more and more to countries like Brazil.”

“Especially if you have Huawei in your 5G network, there will be ‘back doors’ and the ability to decrypt almost all the data that is generated anywhere in Brazil, whether by the government, on the national security front or by private companies in their abilities to innovate and develop new products, techniques and practices, ”he said. The term “back door” refers to ways of accessing computer systems without authorization.

He said it was necessary to protect intellectual property, “especially by China”, as a way to “encourage more innovation.” “We strongly recommend that our partners, including Brazil, use only reliable providers in their 5G network.”

The delegation also includes the Deputy United States Trade Representative, Michael Namelka; the president of Eximbank (Export and Import Bank), Kimberly Reed; the director of the state development bank DFC (International Development Finance Corporation of the United States), Sabrina Teichman.

Boring Homeless Income Program

The newspaper The State of S. Paulo highlights a study by the CLP (Centro de Liderazgo Público) in association with the Insper economist Ricardo Paes de Barros, which proposes ways to make viable a R $ 27 billion income transfer program that replaces Bolsa Família and emergency aid, without stick to the spending ceiling.

Created in 2008, the CLP defines itself as a supra-party organization, which seeks to involve society and develop public leaders to face the problems in Brazil and develop a more efficient state.

Both the leaders of Congress and the government have shown their commitment to an income transfer program called Renta Ciudadana. But the market tends to react negatively if a program like this blows up the spending ceiling.

The economic team even considered using resources from precatoriosis – debts that the government must pay after court convictions – and Fundeb (Fund for the Maintenance of the Development of Basic Education). But these proposals were badly received.

The CLP says that it believes it is possible, however, to create the program without breaking the spending ceiling, restructuring the public accounts in six years.

In 2020, CLP proposes to reformulate existing social programs, with the merger of Abono Salarial and Salário Família and the incorporation of unemployment insurance with the FGTS (Seniority Guarantee Fund). Changes would be made at no additional cost.

In 2021, he proposes to incorporate closed insurance, paid to fishermen, to the project to end the super salaries that exceed the ceiling of the public function and carry out privatizations.

By 2026, he proposes to carry out an administrative reform that affects senior officials. The proposal includes a benefit of R $ 90 for young people from 15 to 17 years old.

Corporate radar

CSN applied for registration on Monday to make an initial CSN Mineração share offering, which will be coordinated by 11 financial institutions.

Retailer Grupo Big also applied for registration to make its initial public offering.

Amid information that its controllers intended to sell the operation in Brazil, the C&A group said there is no process in this regard. And that C&A continues to support its Brazilian operations.

Higher highs

Higher number of casualties

Vale’s iron ore production reached 88.7 million tonnes in the third quarter of 2020, up 2.3% compared to the same period last year. And 31.2% in the second quarter, the company reported on Monday (19). Petrobras publishes today the production and sales report for the third quarter, after the markets close.

In a report published Monday, the daily Valor writes that a partial merger that has been negotiated between brMalls and Ancar Ivanhoe would lead to the creation of the largest shopping center operator in Brazil, with 55 projects.

(Com Reuters e Bloomberg)

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