The 5 issues that will move the market this Friday



European markets opened up on Friday (16), with good results from the car manufacturer Daimler and LVMH Moët Hennessy, producer of luxury brands like Louis Vuitton and Dior. American futures indices also opened with an upward trend, as the market awaits retail data.

However, there are still no positive signs regarding a new stimulus package against the coronavirus crisis.

In Brazil, the market follows the forecast that the government will have to pay more than R $ 640 billion in public debt securities between January and April 2021. It is more than double what is usually paid. There is concern about the country’s ability to pay the bill, especially if a replacement program for Bolsa Família and emergency aid is approved.

On the positive side, CSN posted a profit of more than R $ 1 billion, compared to a loss in the same period last year.

In addition, technicians from the Ministry of Health fear that political motivations will cause the federal government to disregard the vaccine produced in São Paulo by the Butantan Institute, in the vaccination plans of the Brazilian population.

1.Worldwide Scholarships

Good results from luxury clothing brands and the auto sector brought optimism to European stock exchanges.

LVM is up more than 6%, which boosted the sector as a whole. Hermes International is up 3.6%; Burberry, 3.76%; the Kering of 3.86%; and Hermès International, 3.68%. The auto sector is also optimistic, with Daimler reporting above-expected gains, leading to 5.31% increases in its shares.

Thyssenkrupp’s share rose by more than 20% after news that Liberty Steel will make an offer of billions of euros for the German company’s steel unit.

The markets remain cautious, however, due to the rise in coronavirus cases, both in the United States and in Europe, where several countries have again increased restrictions that had been relaxed. In Paris, authorities again applied curfews. In London, meetings between people who do not live together were again restricted.

Germany’s Dax is up 0.68%; the FTSE 100, from the United Kingdom, was up 0.82%; France’s CAC rises 1.23%; and FTSE MIB, from Italy, rises 0.25%.

In the United States, after a near-zero early morning, future indices gained strength after Pfizer said it could apply for the emergency use of its Covid-19 vaccine candidate as early as November, partially offsetting concerns about a deadlock in Washington over more fiscal aid.

The S&P 500 futures index is up 0.16%, the Nasdaq futures are up 0.25% and the Dow Jones futures are up slightly by 0.18%. This Friday brings the expiration of options contracts on shares, indices and funds traded on the US exchange, increasing the chances of volatility.

Returning to Europe, on Thursday the United Kingdom missed the deadline it had set out to close a trade deal with the European Union after Brexit. UK Prime Minister Boris Johnson is due to announce on Friday whether negotiations with the economic bloc, which have not progressed, will continue.

European Commission President Ursula von der Leyen left the talks on Thursday after a member of her team was tested positive with covid-19. She is quarantined.

Asian indices closed in different directions, also influenced by the rise in coronavirus cases in major world economies. Japan’s Nikkei index closed down 0.41%; The Hong Kong Hang Seng index, up 0.94%; Kospi, from South Korea, down 0.83%; and China’s Shanghai index, up 0.13%.

See below the performance of the indexes at 8:30 am (Brasília time):

* S & P 500 Futures (USA), + 0.16%
* Nasdaq Futures (USA), + 0.25%
* Dow Jones Futures (USA), + 0.18%
* Dax (Germany), + 0.68%
* FTSE 100 (UK), + 0.82%
* CAC 40 (France), + 1.23%
*FTSE MIB (Itália), +0,25%
* Nikkei (Japan), -0.41% (closed)
* Hang Seng Index (Hong Kong), + 94% (closed)
* Kospi (South Korea), -0.83% (closed)
* Shanghai SE (China), + 0.13% (closed)

Commodities e bitcoin
* WTI oil, -1.17%, at $ 40.48 a barrel
* Brent oil, -1.25%, at $ 42.62 a barrel
*Bitcoin, US$ 11.285,48, -0,45%
On the ore: ** Iron ore futures traded on the Dalian stock exchange closed down 2.17%, quoted at 785.5 yuan, equivalent today to $ 117.21 (in the past 24 hours).
USD/CNY = 6,70

2. Agenda of indicators

This Friday, the market follows the release of the Eurozone trade balance. At 6 am, the eurozone statistical office reported that exports to the rest of the world dropped 12.2%, to 156.3 billion euros in the comparison between August 2020 and the same month of 2019. Imports fell 13, 5% to 141.6 billion euros. Thus, the trade balance remained positive, at 11.3 billion euros, against 10.6 billion in August 2019.

In Brazil, FGV releases the IGP-10 inflation index at 8 am. And in the United States, the government releases data on retail sales in September at 9:30 am; At 10:15 am data on industrial production, also in September; at 10:30 am, weekly data on grain exports; and at 11 am data on corporate inventories in August, and on consumer confidence in October.

3. Maturity of Brazilian securities

Estadão prints the maturity of federal government debt securities in the amount of R $ 643 billion as a cover story. This value is expected to expire between January and April, and represents more than double the average recorded in the last five years.

This means that, only in this four-month period, the Treasury will need to pay investors the equivalent of 15.4% of the Brazilian domestic debt.

The deadline for payment of the debt by the government is getting tighter due to the shortening of financing. With greater market distrust of Brazilian accounts, the Treasury has been issuing bonds with a shorter term, from six months to one year. There is mistrust about the country’s ability to pay for the papers in the long run.

With the pandemic, the government had to pay more. Thus, public debt should exceed 100% of GDP by the end of the year, a level considered high for emerging countries.

There is suspicion about the Brazilian fiscal framework. Government and Congress have been committed to approving an income program to replace emergency aid and Bolsa Família. With the emergency aid of R $ 600, the level of poverty reached the lowest level in the history of Brazil. Without it, millions of people must return to poverty.

Thus, investors follow the speeches of political authorities on fiscal risk in Brazil. It is worth mentioning that, on the eve, Rodrigo Maia, president of the Chamber, stated that the government base is understanding that there is no way out of the ceiling and the majority of deputies support the reforms, in a virtual event of the BMG bank. Maia’s speech is opposed to Vice President Hamilton Mourão, who said earlier yesterday that the Citizen Income may be out of the ceiling, according to Estadão, which helped put pressure on Brazilian assets yesterday afternoon.

4. Political dispute over the vaccine

The newspaper Valor brings as a cover story a report that states that technicians from the Ministry of Health have shown concern with the politicization around the vaccine against the coronavirus.

On Wednesday (14), the Ministry of Health presented to state health secretaries a vaccination schedule against Covid-19 in which it predicted the start of vaccination for April 2021. The schedule includes only the AstraZeneca vaccine, developed in partnership with the University of Oxford, which is in the testing phase and should be produced in Brazil by Fiocruz, in Manguinhos, in Rio.

According to information from the newspaper Folha de S. Paulo, part of the health secretaries present at the meeting was left with the impression that the federal government was ignoring the vaccine of the Chinese company Sinovac, which has been tested by the Butantan Institute, in São Paulo.

The Health Secretary of São Paulo, Jean Gorinchteyn, told the newspaper that “vaccines are not being treated in a republican way by the Ministry of Health”. At the meeting, technicians from his portfolio said that the vaccine from the Butantan Institute may be available as early as December, with 46 million doses. Another 14 million would be ready by February and 40 million by June.

According to Valor, technicians from the Ministry of Health fear that the government will discriminate against the immunizing agent developed in São Paulo.

5. Corporate radar

CSN announced on Thursday night (15) that it reversed losses in the third quarter, reaching a profit of more than R $ 1 billion. In the previous year, it had a loss of more than R $ 870 million in the same period.

Magazine Luiza bought the digital business school ComSchool, for an undisclosed amount. The company says it will seek to expand the business capacity of its 32,000 registered salespeople. ComSchool offers about 200 courses in digital marketing, e-commerce and social networks.

Klabin informed that Sogemar agreed to reduce the amount requested to be merged. The new merger proposal provides for the issue of 69,394,696 common shares, in the amount of R $ 274 million. The previous proposal foresaw a higher number of shares, 92,902,188.

Triple Play, from the telecommunications industry and São Paulo developer One Innovation, gave up plans for a public offering of shares.

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