Ibovespa opens higher this Wednesday, 02 (Image: Money Times)
O Ibovespa (IBOV) opened trading this Wednesday (2) on a high. The main Brazilian stock market index rose 0.72%, to 133,445 points, at around 10:05 am.
The spot dollar fell against the real in the first negotiations on Wednesday, as investors were still digesting the improvement in the country's credit rating. Brazil for the Moody’s and the increase in geopolitical tensions in Middle East.
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5 things to know when investing in Ibovespa this Wednesday (2)
'This says more about the rating agencies than about Brazil'
Here, investors were surprised last night (1) with unexpected news: the risk rating agency Moody’s challenged the market's widespread pessimism regarding the country's fiscal situation and raised the sovereign risk rating from “Ba2” to “Ba1”, maintaining the positive outlook.
According to Matheus Spiess, analyst at Empiricus Researchthis indicates that Brazil could receive a new upgrade in the next 12 to 18 months, if it continues on its current path.
“With this decision, the country is getting closer to the much-coveted investment grade, and is now just one level away from achieving it. Moody's justification is based mainly on the sustained economic growth since 2021, the material improvement in credit and the strengthening of the trade balance”, he points out. “However, the agency classified the credibility of the new fiscal framework as “moderate”.
For the analyst, although Moody's decision appears to be a relief for the market, he considers it a controversial assessment. “It reflects more on the functioning of rating than on the Brazilian scenario”, he ponders.
This is because, since the 2008 crisis, these agencies have faced questions regarding their credibility, and are often criticized for being “lagging indicators” (late indicators), which react to events that have already passed.
“As this increase in the rating occurs at a time when there are clear signs of deterioration in public accounts, the decision is even more surprising. And the nominal deficit of more than 9% getting worse? What about heterodox parafiscal measures?”, he points out.
Regardless of the reservations, Spiess states that the news should provoke a positive reaction in the local market, with the possibility of a reduction in premiums on the interest curve and greater interest from foreign investors.
“In other words, the market is expected to react optimistically, anticipating new upgrades that may appear in the future. However, it is important to remember that raising the credit rating does not change the perception of fiscal risk, as the government still faces significant challenges until the end of the year”, he says.
However, Spiess points out that unpopular decisions, such as spending cuts, will likely be postponed until after the municipal elections.
Oil prices rise after Iran launches missiles at Israel
The prices of oil advance this Wednesday (2) with the increase in tension in the Middle Eastafter the Iran fired missiles at Israel. Although part of the missiles were intercepted by the Israeli air defense system, there are reports of injuries from the shrapnel.
The Israeli Prime Minister, Benjamin Netanyahusaid Iran made “a serious mistake” in attacking the country and promised retaliation.
“Whoever attacks us, we will attack them (back). This is true in every region where we fight the axis of evil and it is true for Iran too,” said Netanyahu, according to information from the Al Jazeera news agency.
A conflict in the region could disrupt the supply of oil to the world. As a result, at around 8:20 am, oil like Brentwhich is an international reference, rose 3.29% to US$75.98 the barrel; already the WTIwhich is a reference in the United States, advances 3.65%, to US$ 72.39 or barrel.
Also on the market's radar are the releases of official stock data from the Organization of Petroleum Exporting Countries (OPEC+) and the USA.
Eneva (ENEV3) announces follow-on of up to R$4.2 billion
A Eneva (ENEV3) filed on Tuesday night (1) a request to register a subsequent offering of common shares (also known as “follow on”) of, initially, 228,571,429 common shares.
In total, the amount amounts to up to R$4.2 billion, and the shares will be offered at R$14 per share — where the issue price per share will be fixed after the completion of the procedure for collecting investment intentions.
As announced in July, the offer aims to finance power generation projects, natural gas exploration and possible mergers and acquisitions activities.
The demand for shares in the operation is already guaranteed, as Partners Alpha, an investment vehicle for BTG partners that already has a 15% stake in Eneva, has committed to investing in the offer.
Sabesp (SBSP3) elects new CFO and chairman of the board and updates the composition of the board of directors
A Sabesp (SBSP3) announced two changes in his administration. The councilors approved on Tuesday (02) the election of Alexandre Gonçalves Silva as chairman of the board and Daniel Szlak as the new financial and investor relations director.
Silva will assume the position at the sanitation company after finishing his duties as president of the board of directors of the Embraer (EMBR3), which must occur by the next ordinary general meeting (AGM).
Szlak, former CFO of the thermal energy supplier Combiowill take on the position of financial director from this Wednesday (2).
Cury (CURY3) announces payment of R$100 million in dividends
A Cury (CURY3) announced this Wednesday (02) that its board of directors approved the distribution of dividends intermediaries worth a total of R$100 million. The amount corresponds to R$0.3449652297 per common share.
Payment of the proceeds will be made on October 31st of this year and will refer to the existing profit reserves based on the company's quarterly financial information for the period ending on June 30th, 2024.
Those who hold shares in the company on October 4th will be entitled to dividends. Thus, the shares will be traded “ex-dividends” from October 7, 2024.
*With information from Reuters