Brazil's Outlook Includes Unstable Stock Market with Political, Fiscal and Health Uncertainty

Institutional investors and individuals took out more than US$ 1.1 billion from Ibovespa last week, but the balance is still positive; up and down must continue

Ibovespa, the country's main stock index, is experiencing greater volatility due to Brazil's uncertain political and fiscal issues.

Analysts expect that these uncertainties, added to the environment of higher interest rates, international news, and fears about the delta variant of the coronavirus, will continue to bring fluctuations to the Brazilian Stock Exchange over the next few days.

Given this scenario, individual investors withdrew R$ 1.2 billion from the Stock Exchange last week alone, when Ibovespa accumulated a drop of 2.59%. Institutional investors ended up with a negative balance of R$5.2 billion [US$ 1.1 billion] in the period.

Sales also exceeded purchases of assets between investment clubs and financial institutions, which closed with a negative balance of R$190.9 million and R$549.2 million, respectively.

In total, considering all investors, the balance of trading on the Stock Exchange was still positive this week at BRL 91.8 million - the result of the influx of BRL 5.2 billion in foreign capital, of BRL 2.1 billion per share from public and private companies and R$ 20.3 million from other types of investors who took advantage of the fact that shares were cheap to go shopping.​

Translated by Kiratiana Freelon

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