December 7, 2022

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Stocks Await US Midterm Election Results; Retail in Brazil and today’s market topics

US futures indices are running lower, while Asian and European markets are moving in the same direction this Wednesday (9), due to the lack of relevant indicators and waiting for the results of the mid-term elections of the US Congress.

The elections will determine whether Democrats retain slim majorities in the House and Senate or whether Republicans take control of one or both chambers.

For analysts, the decision could make all the difference for Democratic President Joe Biden, whose legislative hopes hinge on whether Democrats can push their agenda through a hyper-partisan Congress.

In Brazil, the focus is on the new government transition and balance sheet season. After Bradesco’s result last night was disappointingBanco do Brasil and Eletrobras are highlighted in the balance sheet.

In regards to the transition news, President-elect Luiz Inacio Lula da Silva will meet with the Presidents of the House of Representatives, Arthur Lira, and Rodrigo Pacheco, of the Senate, in Brasilia (DF) today, Wednesday (9). ), to hammer out the PEC to accommodate unexpected expenses in next year’s budget.

Among the indicators, investors are looking ahead to the September retail sector sale, which is scheduled for release at 9am.

1. World Scholarship

America

U.S. futures retreated after rising as investors eyed the results of the so-called “midterm” midterm elections.

Projections show Republicans will hold a majority in the House, but with the vote tighter than recent polls predict, the contest for control of the Senate is open and fierce.

On an economic basis, investors await the September total inventory numbers due at 12:00 am ET. The market consensus had predicted a 0.8% increase, a slowdown compared to a 1.3% advance in the previous month.

Check Futures Markets Performance:

  • Dow Jones Futures (US), -0.29%
  • S&P 500 futures (US), -0.27%
  • Nasdaq Futures (US), -0.23%

Asia

Asian markets closed with no clear direction as investors digested the results of the US midterm elections and China’s producer price index (PPI) fell in October for the first time since December 2020.

In currency exchanges, the Chinese yuan posted its best day in two years on Friday and held on to most gains since then, but retreated on Tuesday to trade at 7.2553 against the dollar as fresh outbreaks of Covid-19 dampened some optimism. .

  • Shanghai SE (China), -0.53%
  • Nikkei (Japan), -0.56%
  • Hong Seng Index (Hong Kong), -1.20%
  • Kosby (South Korea), +1.06%

Europe

European markets were also mixed on Wednesday (9), as investors in the region awaited details on US midterm elections.

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On the corporate front, quarterly results continue to be one of the main drivers of share prices in Europe.

Shares in German drugmaker Evotec fell more than 11% after its results, while shares in Smiths Group rose 5% after the British engineering firm reported a 13% rise in organic revenue.

  • FTSE 100 (UK), -0.37%
  • DAX (Germany), -0.33%
  • CAC 40 (France), -0.04%
  • FTSE MIB (Italy), +0.42%

materials

Oil prices are trading lower in today’s session as concerns over fuel demand amid a worsening Covid-19 outbreak in China, a major oil importer, and tensions over the results of US congressional mid-term elections.

On the other hand, iron ore contract prices maintained an upward trend for the seventh consecutive session, despite concerns over a rise in new Covid-19 cases in some Chinese cities and weak demand for steel.

Iron ore prices remained higher after China’s interbank market self-regulatory agency said on Tuesday it would expand bond financing to private companies, including real estate developers, with support from the central bank.

  • WTI oil, -0.54% was at $88.43 a barrel
  • Brent oil, -0.31% , US$ 95.06 or a barrel
  • Iron ore traded on the Dalian Exchange rose 2.62% to 686.00 yuan, equivalent to US$94.80.

Bitcoin

  • Bitcoin, -1.14% to $18,028.75 (from 24 hours ago)

2. Agenda

The Brazilian Institute of Geography and Statistics (IBGE) will release retail sales figures for September at 9am.

“Considering retail sales, we expect the core index to remain marginally stable and the broader index, which includes vehicles and construction materials, to advance 0.1% on a monthly basis”, says Itaú. The bank points out that there is significant volatility in seasonal adjustments to retail sales, particularly in the broader index, so it is important to look at year-on-year variation – based on this comparison Itaú predicts a 1% fall in retail sales in September.

On the political agenda, President-elect Luiz Inacio Lula da Silva will meet the presidents of the House of Representatives, Arthur Lira, and Rodrigo Pacheco, of the Senate, in Brasilia (DF) today, Wednesday (09).

Brazil

9:00 am: September retail sales up 0.2% from August and up 1.4% year-on-year, Refinitiv forecast

10am: President-elect Lula meets with House of Representatives Speaker Arthur Lira.

1pm: Lula meets with Senate President Rodrigo Pacheco

PDR

15:30 – Infomoney interviews Luis Novas, CEO of BackMenos, as part of the project Inside the results , which talks to executives at publicly traded companies to talk about the results. Look Full schedule e Ask your question.

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America

12 noon: Total stocks

12:30 pm: Weekly Oil Inventories – EIA

3. Economic news

The Chamber approves the MP opening additional credit for payment of benefits

The House of Representatives approved the temporary measures yesterday. Among them is an extraordinary debt opening article to pay social benefits of R$ 27.09 billion in this year’s budget. The matter goes to the Senate.

According to the text, the Ministry of Citizenship has resources for a R$ 200 increase in the Auxílio Brasil program (R$ 25.5 billion) and an increase in the value of Auxílio Gás (R$ 1.04 billion). . The measure allowed for an additional R$ 41.25 billion outside the spending ceiling to increase social benefits and reduce ethanol taxes. The rapporteur, Deputy Alex Manente (Citizenship-SP) was approved MP without change.

Joint Committee Approves Amendments to 2023 Budget

The Joint Budget Commission (CMO) yesterday approved the draft amendments to the Annual Budget Act (LOA) for 2023.

Amendments now included in the budget include an allocation of R$ 1.5 billion for the Mobile Emergency Care Service (Samu 192); R$ 950 million to promote the agricultural sector and family farming; BRL 500 million to complete the Transmazon highway between Altamira and Ruropolis (PA) and BRL 400 million for basic health care.

The CMO for the third time also decided to change the deadline for processing the LOA 2023 project (PLN 32/2022). The commission is now scheduled to hold public hearings till November 16 and expects to vote on the revenue report by November 23.

4. Political news

Alcmin and Senator Castro adjourn meeting on PEC; Lula goes to Brasilia

The Rapporteur General of the 2023 Budget Report, Senator Marcelo Castro (MDB-PI), announced yesterday that the meeting scheduled for Wednesday, the 9th, with Vice President-elect Geraldo Alcmin to present the transition PEC has been cancelled. According to Congress, Alcmin asked to postpone the meeting because the text of the proposal would first be taken to President-elect Luiz Inácio Lula da Silva.

This Wednesday, Lula will meet the presidents of the chamber, Arthur Lira (PP-AL) and Rodrigo Pacheco (BST-MG) of the Senate, in Brasilia. PT should discuss PEC with both. Today, Alcmin met with Castro and the head of the Mixed Budget Commission (CMO), Vice Celso Sabino (União Brasil-PA). The interim government is negotiating a way to keep campaign promises, such as maintaining the Auxilio Brasil at R$600, outside the spending ceiling — which limits government spending growth to the previous year’s inflation rate.

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Covid

This Tuesday (8) Brazil recorded 95 deaths from Covid-19 in the last 24 hours, bringing the total to 688,539 since the pandemic began.

Along with this, the moving average of deaths in the last 7 days was 38. Compared to the previous average of 14 days, the variance was -44%.

In total, the country recorded 11,970 new Covid-19 diagnoses in 24 hours, ending the 34,909,480 known cases since the pandemic began.

The balance season continues in full swing with Banco do Brasil, PRF, Carrefour Brasil, Eletrobras, Bets, Iochp-Maxion, Aluber, Equatorial, Hapvita, Santos Brasil, Simbar, SulAmerica, Tesa, DC, Ultrabar, Reder d’Or, etc. , Positivo, Porto Seguro, Oi, Natura, MRV, Moura Dubeux and Minerva are expected for the day.

Bradesco (BBDC4)

Bradesco (BBDC4) Recurring revenue was recorded at R$5.223 billion in the third quarter of 2022 (3Q22). A decrease of 22.8% compared to the same period in 2021. The result is R$ 6.76 billion below the Refinitiv plan.

“The main reasons for this decision were the performance of the financial range with the market, which was negatively affected by the current position of SELIC, the increase in the extended PDD caused by the default scenario, the strengthening of the complementary PDD and the impact of IPCA deflation on the financial end of the insurance,” explained the bank.

Check balance sheet highlights

Accounting net income was R$5.211 billion in 3Q22, down 21.6% compared to the same period in 2021.

Braschem (BRKM5) reported A net loss of BRL 1.103 billion in the third quarter of 2022That compares with net income of R$ 3.537 billion in the same period in 2021, the petrochemical company said. Refinitiv consensus forecasts net income of R$ 633.5 million for the period.

Earnings before interest, taxes, depreciation and amortization (EpidaAbbreviation in English) was R$ 1.967 billion in 3Q21, a decrease of 74% compared to 3Q21 and below the Refintiv plan, which was R$ 3.237 billion.

(With Estadão, Reuters and Agência Brasil)

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