Ibovespa declines with strong US employment data; Vale falls more than 1% By Reuters

Ibovespa declines with strong US employment data; Vale falls more than 1% By Reuters
Ibovespa declines with strong US employment data; Vale falls more than 1% By Reuters

© Reuters. REUTERS/Amanda Perobelli

By Paula Arend Laier

SÃO PAULO (Reuters) – The market was falling this Friday, after strong data from the United States labor market, which further weakened bets on a cut in North American interest rates in the first quarter.

At 11:18 am, the Ibovespa fell 0.92%, to 127,299.70 points. At its highest, earlier, it reached 128,878.43 points. The financial volume in the trading session totaled around 4 billion reais.

According to data from the US Department of Labor, 353,000 jobs were created in the country in January, well above expectations of 180,000. The unemployment rate was 3.7% compared to a forecast of 3.8%.

The yield on the 10-year US Treasury bond reached new highs after the release of the numbers, reaching 4.0085% recently, from 3.863% the day before. Stock futures on Wall Street also worsened.

Global X ETFs research director Morgane Delledonne said the data reinforces the Federal Reserve’s view of postponing discussions on first rate cuts.

Last Wednesday, Federal Reserve Chair Jerome Powell had already cooled bets on an earlier cut, stating that he did not think a reduction in March was likely, even though he observed an improvement in inflation.

Itaú BBA’s technical analysis assesses that the Ibovespa needs to surpass 129,400/558 points to trigger a more consistent recovery that could take the index to levels of 132,000 and the December maximum, at 134,400 points.

“On the downward side, the region of 126,400 points remains a warning sign for investors,” he stated in a note to clients.


– VALE ON (BVMF:) fell 1.11%, to 66.70 reais, registering the fifth consecutive drop, pressured in this session by a new drop in futures contracts. The most traded month on the Dalian Commodity Exchange in China ended the day’s trading with a decline of 2.23%, as concerns persist about the recovery of the Chinese real estate sector. The mining company’s shares reached 66.58 reais at the worst moment, shortly after the release of employment data in the USA.

PETROBRAS PN (BVMF:) had a positive variation of 0.19%, at 41.65 reais, seeking to maintain the positive bias that predominated during the week — the share closed falling only on Tuesday — and secured new historic highs for the stock . Abroad, however, oil prices fell, with a barrel showing a negative variation of 0.61%. In the sector, PETRORECONCAVO ON fell 2.56%, PRIO ON lost 2.97% and 3R PETROLEUM ON (BVMF:) lost 0.6%.

– COGNA ON (BVMF:) fell 8.68%, to 2.63 reais. Analyst report from BTG Pactual (BVMF:) cut the share recommendation to “sell” and reduced the target price from 3.4 to 2.6 reais, citing a “stretched valuation” and weak earnings dynamics among the reasons. At the same time, analysts raised their recommendation for Yduqs (BVMF:) to “buy” and the target price from 26 to 28 reais, seeing a good entry point into the shares, supported by solid dynamics for results and exposure to more resilient niches, among other factors. YDUQ3 ON advanced 0.47%, to 19.22 reais.

– AZUL PN (BVMF:) rose 3.02%, to 13.65 reais, supported by a report from BTG Pactual that raised the recommendation of the shares to “buy”, as well as the target price from 20 to 33 reais, citing among the arguments a stronger capital structure and less competition in the domestic market after Gol (BVMF:) filed for judicial recovery in the USA. In parallel, BTG analysts cut Gol’s recommendation to “sell”, reducing the target price from 10 to 1 real, citing the company’s decision to file for judicial recovery in the USA and the financing of 950 million dollars in the modality ” debtor in possession” (DIP). GOL PN fell 1.12%, to 2.65 reais.

– GERDAU PN (BVMF:) appreciated 1.67%, to 21.32 reais, after a report from Goldman Sachs (NYSE:) raising the share recommendation to “buy” and the target price from 25 to 26 reais. Analysts saw attractive valuation levels, while assessing that investor confidence and the dynamics of results are almost at the bottom. In the sector, CSN ON (BVMF:) gave up 2.39% and USIMINAS PNA (BVMF:) recorded a decrease of 1.19%.

– ITAÚ UNIBANCO PN (BVMF:) fell 1.22%, to 32.29 reais, and BRADESCO PN (BVMF:) fell 1.14%, to 15.13 reais, contaminated by the worsening of the market. Next week holds a battery of results from the sector. BTG Pactual opens the agenda before the opening on Monday, while Itaú announces it on the same day, but after the closing. Bradesco reports early on Wednesday and Banco do Brasil presents its performance late on Thursday. BANK OF BRAZIL ON (BVMF:) had a drop of 0.62% and BTG PACTUAL UNIT showed a decrease of 0.87%.

The article is in Portuguese

Tags: Ibovespa declines strong employment data Vale falls Reuters



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