BRAZIL: After Four Days Of Gain, Ibovespa Falls Amid Caution Abroad

(RTTNews) - Ibovespa, the benchmark stock index in Brazil, interrupted a sequence of four positive trading sessions, in which it got close to historical levels, and fell 0.45% Friday, ending at 73,078.85 points. The session was marked by greater caution in the external scenario and falling commodity prices. The political scene also remained on the radar after the arrest of the former government minister Geddel Viera Lima in Salvador.

"Investors have taken a more risk-averse stance in this Friday's session, with concerns about the conflicts involving North Korea and natural disasters such as Hurricane Irma," said Rafael Passos, an analyst at Guide Investimentos.

Hurricane Irma, which has devastated parts of the Caribbean, hit Florida in the United States on Sunday. According to Mr. Passos, the natural disaster worries market players, fearing that the storm will also affect the region's economy.

The hurricane may still impact energy demand, which has pushed oil prices downwards throughout the day, with WTI contracts falling by more than 3 percent. The losses of the commodity were felt by Petrobras (PETR4 -1.93). Meanwhile, losses in iron ore reflected in Vale's shares (VALE3 -3.69%).

The largest devaluations, however, were Gerdau shares (GGBR4 -5.34%), influenced by corruption charges in the context of Operation Zelotes.

The locally traded U.S. dollar, meanwhile, closed down 0.25%, to R$ 3.0950 - the lowest closing since March 21 (R$ 3.0910). The greenback was adjusted to the losses recorded yesterday abroad and with investors more optimistic about the possibility of the government passing reforms in the National Congress, such as the Pension one.

This week, Lerosa Investimentos analyst Vitor Suzaki points out that the market will continue to follow the external scenario due to "the possibility of increased geopolitical tension between the United States and North Korea."

He also highlights the local political scene, with investors awaiting a possible new accusation against the Brazilian President Michel Temer, who has seen one of his former ministers be arrested Friday.