Foreigners Disinvest from the Brazilian Stock Exchange after Bolsonaro's Intervention at Petrobras

February flow was negative by US$ 1.2 billion

São Paulo

President Jair Bolsonaro's (no party) intervention in Petrobras boosted the outflow of R$ 6.784 billion (US$ 1.2 billion) in foreign investment from the Brazilian stock exchange in February, the worst monthly balance since July 2020, when not considering stock purchases in IPOs and subsequent actions (follow-on).

Between February 1st and 18th, before Bolsonaro gave the first sign that a change in the state-owned company would interfere, there was a net inflow of R$ 4.6 billion (US$ 854 million) in foreign money, according to data from B3.

On the 22nd, the Monday after the announcement of a change in command of the state-owned company, R$ 6.85 billion flowed out, according to data from B3 compiled by XP. On the 23rd, it was R$ 2.35 billion (US$ 433 million) less. In the last three trading sessions of the month, the sale of shares decelerated and the balance was negative by R$ 2.14 billion (US$ 397 million).

"If there is one thing that gringos do not accept, it is governance problems. The ESG theme abroad is getting stronger and stronger", says Romero Oliveira, variable income director at Valor Investimentos.

ESG stands for best environmental, social and governance practices and is a factor that is increasingly important in investor decisions.

Translated by Kiratiana Freelon

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