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BUENOS AIRES.- The main index of Brazilian equities rose more than 3% on Tuesday, boosted by the shares of Telefonica Brasil, which led the advance after announcing a sharp rise in profits in the third quarter.
The Bovespa index canceled Monday's losses, rising 3.2% and settling to 86,523 units, after falling to 83,796.71 units in the previous session.
The market was boosted by the shares of Telefonica Brasil, which led the advance after announcing a sharp rise in their profits in the third quarter.
Likewise, the positive climate has been supported by the signals of the elected President, Jair Bolsonaro, about a pension reform and waiting to vote on a bill.
It should be noted the shares of Telefonica Brasil, which jumped 9.24%, after the company announced a 160% increase in its net profit in the third quarter, to 3,177 million reais.
Itaú Unibanco Bank's shares rose by 2.43%, canceling the losses incurred at the beginning of the session, while the third quarter result showed an increase in administrative expenses and a drop in revenues.
Petrobras rose by 3.84%, followed by Petroleo Brasileiro (3.63%) and Embraer (4.49%).
The Brazilian market fell by 2.24% on Monday, after reaching an intra-day record early in the session, taking advantage of investors waiting for the definitions of the government of the elected president, Jair Bolsonaro, and driven by a sharp drop in Wall Street. .
Bolsonaro, a far-right legislator and retired army captain, garnered 55.2 percent of votes in the second round on Sunday, compared with 44.8 percent of his left-wing rival, Fernando Haddad.
Strategists XP Investimentos have estimated that the Bovespa could reach 100,000 points by the end of the year and that the real should strengthen between 3.50 and 3.70 to the dollar. "For this movement to materialize, the reforms are crucial (…) If they materialize in 2019, the stock index could reach 125,000 points," said analysts.
On the foreign exchange market, the Brazilian real appreciated by 0.3% against the dollar, to 3 773 dollars.
The chief economic adviser of Jair Bolsonaro, President-elect of Brazil,
announced Tuesday that he would only sell his currency reserves in case of a speculative attack that would move his currency to about 5 units per dollar, he said.
Earlier in the day, local newspaper Valor Economico announced that Paulo Guedes, the Bolsonaro government's future finance minister, had proposed reducing the country's foreign exchange reserves in order to repay the public debt.
Guedes thinks that Brazil has an excessive buffer of liquidity, I quote an unidentified source from the newspaper that collaborated in drafting the right-wing legislator's government program.
The Argentine Stock Exchange, meanwhile, It advances by buying between the papers of the energy and financial sectors, in the caution of investors who have cast their eyes on the Brazilian place for the election result and its short-term prospects.
The Merval index, the main market benchmark, rose 1.45% to 25,902 units, following a 1.29% decline on Monday.
The gains in the Metrogas distributor's newspapers, which increase by 3.7% and those of the Supervielle group with 2.6%, stand out.
On the foreign exchange market, the Argentine peso appreciated by 0.22% to 36.84 units per dollar
With information from Reuters and Bloomberg.
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