Market closing of the week and analysis
by * Luiz Felipe Bazzo , CEO of transferbank

After a consecutive month of weekly falls, the Ibovespa started another week in the negative. The main Brazilian stock market index fell 0.44% on Monday, the 17th, closing at 119,137 points. The day was marked by concerns about the Focus Bulletin, which reflected fiscal uncertainties.

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On Tuesday, the 18th, the dollar closed up 0.22%, quoted at R$5.439. The day before, the currency had ended the session with an increase of 0.73%, reaching R$5.421. The stability of the currency is attributed to the expectation surrounding the Copom decision on Wednesday, with investors waiting to understand the next steps of monetary policy.

On Wednesday, the 19th, the Ibovespa rose 0.53% and closed at 120,261 points, on a day of reduced liquidity due to the holiday in the United States. The dollar appreciated 0.15%, closing at R$5.442, after reaching R$5.483 during the session, the highest value in 18 months.

On Thursday, the 20th, the Ibovespa closed up 0.18%, reaching 120,446 points, with investors reacting to the Copom’s decision to maintain the Selic at 10.50%. Maintaining interest rates was already expected, but the unanimous vote seemed to encourage investors. On the other hand, President Luiz Inácio Lula da Silva’s criticism of the Central Bank added caution to the negotiations. The dollar closed higher, reflecting the advance of the US currency abroad, in light of the president’s statements about the Copom meeting. The currency closed at R$5,462, the highest value since R$5,498 on July 22, 2022.

On Friday, the 21st, the dollar opened down 0.37%, at R$5.44. The day before, the American currency had closed at R$5.46, the highest level in almost two years, driven by President Lula’s statements. At 12:45 pm, the American currency had a marginal drop of 0.04%, to R$5.4584, reflecting the high American interest rate, currently between 5.25% and 5.50%, the highest since 2001. The slowdown in activity The economic trend strengthens the thesis that the Fed will cut interest rates in September, keeping its reference rate in the current range since last July.

The Ibovespa is heading towards its fourth session of increase and closing the week on a positive note, recovering part of the recent losses. Around 2:10 pm, the index had increased by 0.63%, to 121,210 points, with a projected volume of just over R$20 billion, although this could change due to the expiration of options. The dollar, in turn, fell 0.49%, quoted at R$5.44.

Gold showed gains earlier, but ended Friday in positive territory, pressured by the dollar. The exchange rate movement was supported by data from the United States, making the metal more expensive for holders of other currencies, which reduced investor appetite. In addition, sector news was monitored.