BRAZIL: Ibovespa Closes Slightly Higher, Restrained By Pension Reform Fears

(RTTNews) - Ibovespa, the benchmark stock market index in Brazil, closed slightly higher (+0.09%) at 72,800.04 points Monday as investors remained cautious about a potential delay in the pension reform bill vote.

Earlier, the index fell, reflecting pessimistic statements by the House Speaker Rodrigo Maia about the reform and fears about an attempted terrorist attack in New York. But then the Ibovespa rose again.

Investment analyst Glauco Legat from Spinelli Corretora said the Ibovespa has shown higher volatility, a trend that may continue in the next few days, reflecting the negotiations on the pension reform.

However, the market has already begun to price in a vote postponement. Next week the government will have its last window to vote on the bill this year as the Congressional recess approaches.

"A few weeks ago there was a stronger perception that the reform would be approved. We believe that [the bill] will not pass [a House vote], but if it does it would be a good trigger for the stock market to gain momentum," the analyst said.

Among the positive highlights of the trading session were Vale's shares (+0.99%) and steelmakers, such as Usiminas (+3.35%). On the negative side, the largest losses were seen in the education sector, with Estácio (-4.61%).

The locally traded U.S. dollar went through another session marked by volatility, once again influenced by investors' fears with the pension reform and also by the external scenario. The greenback ended up 0.06%, quoted at R$ 3,298 for sale, after operating a good part of the day in the negative field.

In the coming days, the market must remain attentive to the negotiations on the pension reform bill. Still, in the domestic market, the minutes of the Monetary Policy Committee (Copom) are expected Tuesday.

However, for Luana Nunes, an analyst at Toro Radar, there are no more relevant events scheduled to occur until the end of the year, which may bring lower trading volume to the stock exchange.