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The Ibovespa, Brazil’s benchmark stock index, managed to recover from its initial losses during the day’s trading session, ending with a slight increase of 0.1% to reach 119,662 points by the close on Friday.
Despite nearing its lowest point since the beginning of November, influenced by ongoing political disputes, the index saw a weekly decline of 0.9%. The recent decision on interest rates underscored the diverging perspectives between the current government and its predecessor, notably with Finance Minister Haddad opposing the increase in public expenditure. Such opposition contributed to a decrease in the value of Brazilian financial assets.
Petrobras, the state-owned oil company, experienced a 1% drop in its share price, even amidst a strong performance in oil prices over the week. Vale, a major iron ore producer, saw its stock price decrease by 0.4%, despite an increase in iron ore prices. Gerdau, a steel manufacturing company, witnessed a 1.7% decline in its shares. Conversely, several companies achieved gains in their stock prices which contributed to the index’s marginal recovery for the day. Magazine Luiza’s shares increased by 2.2%, Ambev’s by 1.6%, and WEG’s by 1.4%.
In terms of economic performance, the IBC-Br index, a measure of economic activity, indicated no growth in April, demonstrating stagnation rather than the anticipated 0.45% expansion. Such stagnation underscores the ongoing challenge of managing government spending while also mitigating inflation risks.
(Bovespa Index Yearly Chart)
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