Ibovespa closes higher and the dollar drops slightly on the eve of Copom

The Ibovespa closed this Tuesday’s trading session (7) up 0.55%, at 129,173.44 points. The financial volume totaled R$21.2 billion before final adjustments. B3, today, was influenced by the rise of the main banks, Vale (VALE 3) and Petrobrás (PETR3 / PETR4), following the good wave of global markets.

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Itaú (ITUB4) reported a very solid first quarter balance sheet, a fact that pleased investors and caused shares to rise by more than 2% today. Furthermore, UBS raised the target price of Vale’s ADR, traded in NY, from US$13 to US$15. For Elcio Cardozo, capital market specialist and partner at Matriz Capital, as the quarterly balance sheets released by the main companies were positive, a large part of the stock market operated higher.

Brazilian future interest rates fell. According to Cardozo, this downward movement is influenced by the fall in North American Treasuries. “Rates in the US began to fall after the release of economic data last week, which indicated a possible slowdown in the economy and inflation control. In Brazil, expectations of a 50bps cut at the Copom meeting, which will end tomorrow, also increased. Until last week, there was almost a market consensus on a cut of just 25bps. Therefore, we also see this drop today in future interest rates”, says the expert.

The spot dollar ended Tuesday (07) practically stable against the real, for the second consecutive day, in a session in which the North American currency fluctuated within narrow margins, with investors cautious about the size of the Selic base rate cut in Wednesday, when the Copom meeting ends.

The US currency in cash closed the day at R$5.0681 on sale, a slight drop of 0.13%. In May, the currency accumulated a drop of 2.40%.

At 5:04 pm, on B3, the first maturity dollar futures contract fell 0.14%, to R$5.0785 on sale.

The S&P 500 and Dow Jones indexes closed higher this Tuesday (07), extending their recent streak of gains, driven by renewed expectations that the Federal Reserve will cut interest rates this year.

According to preliminary data, the S&P 500 gained 0.13% to 5,187.49 points. The Nasdaq technology index lost 0.10% to 16,332.56 points. The Dow Jones had a positive change of 0.07%, to 38,878.45 points.

HIGHLIGHTS

– ITAÚ UNIBANCO PN (ITUB4) closed up 2.07%, after 15.8% growth in recurring net profit in the first quarter of 2024, in a result marked by improved profitability, while the CEO signaled a chance for the bank to return to distribute an extraordinary dividend this year.

– VAMOS ON (VAMO3) jumped 13.05%, after the heavy vehicle fleet management and rental company reported an 8.2% increase in net profit for the first quarter compared to the same period in 2023, in a result above expectations by analysts.

– REDE D’OR ON (RDOR3) soared 9.33%, amid a 165.2% jump in net profit in the first quarter, compared to the first three months of the previous year, exceeding market forecasts.

– VIVARA ON (VIVA3) appreciated 3.9%, with the result of the first quarter of the year on the radar, when the jewelry store chain achieved revenue of R$ 574.9 million, growth of 17.9%, with an increase of 14.1% in the Jewelry category and 22.6% expansion in the Life category.

– SUZANO ON (SUZB3) fell 12.27%, reacting to the Reuters report citing sources that the world’s largest eucalyptus pulp producer contacted International Paper about an all-cash offer that could be valued at almost US$15 billion .

– IRB(RE) ON (IRBR3) fell 8.77%, with agents seeking to understand the potential effects on the reinsurer of the events in Rio Grande do Sul.

– TIM BRASIL ON (TIMS3) lost 6.2%, after the first quarter balance sheet showed normalized net profit of R$519 million in the first quarter of this year, an increase of 19% compared to the same period of the previous year.

– EMBRAER ON (EMBR3) fell 2.01%, amid the analysis of the adjusted net loss of R$63.5 million in the first quarter, much lower than the negative result of R$460.5 million recorded a year earlier. Embraer reaffirmed estimates for 2024 and denied plans for a new rival aircraft from Boeing and Airbus.

– PETROBRAS PN (PETR4 / PETR3) advanced 2.42%, even with the decline in Brent oil prices abroad, where the barrel ended with a decline of 0.2%, at Us$ 83.16.

– VALE ON (VALE3) advanced 0.62%, even with modest variations in iron ore future prices in China. Analysts at UBS raised their recommendation on the company’s U.S.-traded stock receipts (ADRs) to “buy” and the price target to $15 from $13.