New York futures trades flat, with investors reassessing the economic outlook; Lula in Argentina and other highlights

New York futures indices are trading close to stable, while European markets are mostly up on Monday (23), with investors evaluating a possible slowdown or pause in Federal Reserve (Fed) interest rate hikes and look forward to a busy week of corporate results.

Global markets mulled over the possibility that the Federal Reserve is preparing to slow the pace of its rate hikes to fight inflation after last week’s economic data showed a drop in wholesale prices and retail sales .

Market operators are also absorbing Friday’s (20) comments from Fed Governor Christopher Waller, who said he was in favor of a 0.25 percentage point hike at his February 1 meeting, when the US central bank will present its next interest rate policy update. Waller also said that rates are already high enough to slow the economy.

Ibovespa today: live market movement this Monday

US earnings season gains momentum and, after the banks, the focus shifts to big tech companies. Microsoft and Tesla release fourth quarter numbers this week.

In these parts, the season of results officially begins on Thursday (26th), with the publication of the numbers of Cielo (CIEL3).

In the political field, the presidents of Brazil, Luiz Inácio Lula da Silva, and of Argentina, Alberto Fernández, confirmed their intention to create a common South American currency for commercial and financial transactions.

1. World Scholarships

WE

US index futures are trading near stability on Monday morning (23rd) as investors evaluate the Fed’s next moves and prepare for a busy week on balance sheets.

After Netflix released its results last Thursday, showing a 90% drop in profits but stronger-than-expected subscriber growth, the next “big tech” of earnings season is Microsoft. On Tuesday (24th), the results of the second fiscal quarter of the company founded by Bill Gates will be presented.

On Wednesday (25th), it’s the turn of Tesla’s results. The expectation is that Elon Musk’s electric car maker’s profits will grow over the period.

On the monetary policy front, there are no speeches from Fed officials scheduled as the central bank meets the following week on Jan. 31 and Feb. 1.

See how the futures markets performed:

• Dow Jones Futures (US), +0.08%
• S&P 500 Futures (US), -0.03%
• Nasdaq Futures (US), 0.00%

Asia

Asian markets closed lower, but most markets remained closed for the Lunar New Year holiday, with Shanghai markets closed for the entire week.

Japan’s Nikkei index rose 1.1% to 26,852.85 and Australia’s S&P/ASX 200 index rose 0.1% to 7,456.90. Today’s rally followed Friday’s rally in technology stocks which offset concerns about a weakening US economy.

• Shanghai SE (China), closed for holidays
• Nikkei (Japan), +1.33%
• Hang Seng Index (Hong Kong), closed for holidays
• Kospi (South Korea), closed for holidays

Europe

Most European markets are trading higher in today’s session as investors in the region reassess the economic outlook.

IMF Chief Executive Kristalina Georgiev told the World Economic Forum on Friday that the global economic outlook is not as bad as feared a few months ago – “but less bad still doesn’t mean good.” You also said that “we have to be careful”.

In indicators, investors await January consumer confidence data.

• FTSE 100 (UK), +0.19%
• DAX (Germany), +0.08%
• CAC 40 (France), -0.08%
• FTSE MIB (Italy), -0.24%

Goods

Oil prices fell on the back of the East Asian Lunar New Year holiday but held onto most of last week’s gains on the prospect of an economic recovery in China this year.

The coalition of the European Union and the Group of Seven (G-7) to limit the prices of Russian refined products from February 5, in addition to the cap on the price of Russian crude in force since December and an EU embargo on oil imports Russian by sea.

The G-7 agreed to postpone a review of the Russian oil price cap to March, one month later than originally planned, to allow time to assess the impact of the price caps on petroleum products.

• WTI Crude Oil, -0.18%, to $81.49 a barrel
• Brent Crude, -0.19%, at 87.46 dollars a barrel

bitcoins

• Bitcoin, +0.90% to $22,713.09 (24 hours ago)

2. Schedule

The highlight of the week’s agenda is the preview of the Extended Consumer Price Index, the January HICP-15. The data will be released on Tuesday (24).

“The deceleration to a 0.52% increase should reflect less managed price pressure (fuel and energy). The services, which lead to the accommodation of the nuclei, must be left aside”, argues Bradesco.

On Thursday (26th), foreign accounts will be released by the Central Bank. For the balance of payments, Itaú calculates a current deficit of US$ 6.4 billion in December, lower than the negative US$ 7.7 billion recorded a year earlier. For the trade balance, the bank expects a surplus of 3.5 billion dollars.

The US starts the week closest to a fiscal crisis. The expectation is that the country will reach the debt ceiling of 31.4 trillion US dollars on Thursday (26). In theory, once the debt limit is reached, the government would no longer be allowed to borrow. Congress must suspend or change the value of the ceiling, but there is a stalemate between the Republicans, who control the House of Representatives, and Joe Biden’s Democrats.

Also on Thursday, the market will know the first reading of the US Gross Domestic Product (GDP) for the fourth quarter of 2022. The consensus of Refinitiv points to a growth of 2.6%. If the number is confirmed, it means that the US economy has continued to grow even under the effect of higher interest rates to contain the escalation of inflation.

In addition, investors will be watching the release of the Purchasing Managers Index (PMI) for the industrial and services sector – and whether there has been any improvement in these numbers.

Brazil

8am: Weekly CPI-S

8:25 am: Focus Bulletin

3pm: Weekly trade balance

eurozone

12pm: January Consumer Confidence

Japan

21:30: PMI of services and industry

3. Economic news

Lula and Fernández announce studies to create a common currency

An article jointly signed by the presidents of Brazil, Luiz Inácio Lula da Silva, and Argentina, Alberto Fernández, confirms the intention to create a common South American currency for commercial and financial transactions. The text signed by the heads of state, on the eve of the first bilateral meeting between the presidents of the two countries in more than three years, was published this Sunday 22 in the Argentine newspaper Perfil.

According to Clarin, the idea that Argentina and Brazil have a common currency for trading transcended the political fissures between the countries. “Lula da Silva proposed it as soon as he was elected to his first term, in 2002, the idea was revived years later by the governments of Jair Bolsonaro and Mauricio Macri, and now Lula and Alberto Fernández are dreaming of it”, recalled the Argentine newspaper .

4. Political news

Lula makes his first international government trip

During the two-day stay in Buenos Aires, Argentina, Lula will meet the country’s president, Alberto Fernández, sign bilateral agreements and meet businessmen. You will also participate in the summit of the Community of Latin American and Caribbean States (CELAC), a collegial body that Brazil rejoined after withdrawing during the government of Jair Bolsonaro.

After the visit to Buenos Aires, Lula went to Montevideo, the capital of Uruguay, also on an official visit. The president’s agenda in the country of Platinum has not yet been confirmed, but, in addition to the bilateral meetings, a new meeting with the leader of the left and former Uruguayan president José Pepe Mujica is scheduled.

The German prime minister is expected to arrive in Brazil next week

German Prime Minister Olaf Scholz will visit Brazil in the coming weeks. Officially, German diplomatic sources have not confirmed the date, but on Saturday (21st), in an interview with GloboNews, President Luiz Inácio Lula da Silva anticipated that Scholz should arrive in Brasilia on 30th January.

As Agência Brasil learned, Scholz will travel accompanied by ministers and a group of executives, representatives of the major companies in his country. An important trading partner of Brazil, Germany has expressed interest in a political rapprochement with the country, with the possibility, among other things, of allocating greater financial resources to finance projects and actions for environmental protection developed mainly in the Amazon.

covid

Brazil yesterday recorded 7 deaths from covid-19 in the last 24 hours, for a total of 696,323 since the start of the pandemic.

With that, the rolling average of deaths over the past 7 days is 135. Compared to the average 14 days ago, the change was -3%.

In total, the country recorded 1,073 new Covid-19 diagnoses in 24 hours, completing 36,734,089 known cases since the start of the pandemic.

American (AMER3)

On Saturday (21st), Americanas (AMER3) issued an official statement to its customers on its website to say that it continues to operate normally and there is no risk to purchases across all of its service channels.

“We remain open and ready for your purchases and deliveries, in stores, on the site and in the app.”

Jorge Paulo Lemann, Marcel Telles and Carlos Alberto Sicupira speak

In the first public demonstration since the billionaire gap in accounting broke out at Americanas (AMER3), a company in which the trio Jorge Paulo Lemann, Marcel Telles and Carlos Alberto Sicupira are major shareholders, denied being aware of the accounting “inconsistencies” , which led to the company’s shares being dissolved on the stock exchange, requesting judicial recovery and, consequently, exiting the Ibovespa, as well as other B3 indices (B3SA3).

“We have never been aware of and would never admit accounting maneuvers or cover-ups in the company. Our performance has always been guided, over the decades, by ethical and legal rigour. This was decisive for the position we have achieved in a life dedicated to entrepreneurship, job creation, business building and contributing to the development of the country”.

Santander (SANB11)

Banco Santander (SANB11) informs that Sérgio Rial has resigned as Chairman of the Board of Directors. He also steps down as a member of the Council’s advisory committees of which he had been a member up to that point.

Marfrig (MRFG3)

Marfrig (MRFG3) announced that it has received new permits for its factories for the export of fresh beef and processed products from the Ministry of Agriculture. Included are licenses to export fresh beef to the Republic of Indonesia from three factories: Chupinguaia (RO), Promissão (SP) and Tangará da Serra (MT).

Also included was a license to export fresh beef to the Republic of Singapore from one factory: Bagé (RS); lastly, the authorization was issued for the export of industrialized products to Canada from a plant: Industrialized Unit of Várzea Grande (MT).

(With Estadão, Reuters and Agência Brasil)

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