Ibovespa falls sharply with global fears about the Ômicron – ISTOÉ MONEY variant

by Andrew Romani

SAO PAULO (Reuters) – The main stock index on the Brazilian stock exchange had a strong devaluation this Monday, amid the global fall in risky assets due to fears with the Ômicron variant of Covid-19.

At 10:53 am, the Ibovespa fell 1.85% to 105,214.05 points. The financial volume was 4.1 billion reais.

The rise in global Ômicron infections caused concerns in financial markets in the opening week before Christmas, as several European countries and the UK assess the possibility of restrictions during the holiday. In the Netherlands, for example, measures have already been imposed to prevent the health system from being overloaded.

Furthermore, the prospect of lower-than-expected economic growth in the United States weighs on market confidence, after US President Joe Biden’s domestic investment package, budgeted at $1.75 trillion, suffered a setback. Joe Manchin, a moderate Democrat considered key to passing the text, said on Sunday he would not support the bill.

Still, the agenda is expected to be voted on early next year, according to US Senate Majority Leader Chuck Schumer.

Major US stock index futures were down more than 1%, as was the pan-European stock index STOXX 600.

In Brazil, the 2022 Budget final report is expected to be voted on by the Mixed Budget Commission, while investors remain attentive to news on the fiscal front.

The Focus bulletin, released weekly by the Central Bank, showed that economists consulted by the institution reduced for the 10th time in a row their expectations for the growth of the Brazilian economy this year. For inflation, the estimate for 2021 year dropped slightly, while for next year there was a slight increase.

HIGHLIGHTS

– CVC ON sank 5.4%, BLUE PN fell 4.3%, GOL PN dropped 3.3% and EMBRAER ON retreated 3.2%, with fears related to Ômicron weighing on actions in the air and tourism sector.

– PETROBRAS PN and ON fell 3% and 2.9%, respectively, while PETRORIO ON fell 5%, as oil prices fell due to fears with the new variant.

– VALE ON dropped 0.9%, CSN ON yielded 3.2%, USIMINAS PN dropped 3.4% and GERDAU PN dropped 2.9%, even after iron ore futures contracts in Dalian and Singapore rose by the third consecutive session, driven by renewed optimism around demand for steelmaking raw material.

– HYPERA ON fell 1.7%. The General Superintendence of the Administrative Council for Economic Defense declared the company’s purchase of Sanofi assets “complex”.

– ENEVA ON advanced 1.2% and one of the only shares on the Ibovespa that operated in the positive.

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