FX.co ★ Ibovespa Rises on Growth Signs and Central Bank Outlook

The Ibovespa index experienced a notable increase of approximately 1.7% on Monday, surpassing the 138,000 mark, buoyed by positive domestic economic indicators and widespread gains across various sectors. April saw a 0.2% rise in the Brazilian Central Bank’s Economic Activity Index (IBC-Br), which serves as a preliminary gauge for GDP. Additionally, the General Price Index (IGP-10) for June indicated a decrease of 0.97%, consistent with the Focus Report's suggestion that investors are projecting lower inflation for the year. While both the Brazilian Central Bank (BCB) and the U.S. Federal Reserve (Fed) are anticipated to maintain interest rates on Wednesday, the possibility of a domestic rate hike has not been entirely ruled out. Concurrently, geopolitical tensions remain high due to escalating conflicts between Israel and Iran, coinciding with a G7 summit impacted by former President Trump’s tariff policies. In the corporate sector, notable gains were recorded in companies such as Vale and Eletrobras, both increasing by 0.6%, Hapvida up by 1%, and major banks including Bradesco, Banco do Brasil, Itaú Unibanco, and Santander, which saw increases of 1.3%, 1%, 1.5%, and 1.2%, respectively. Additionally, the meatpacking industry observed a lift with BRF rising by 1.7% and Marfrig by 1.3%, while the steel industry saw gains led by CSN, which rose by 3.3%, and Gerdau by 1.2%. In contrast, the supermarket sector experienced mixed results, with Assaí increasing by 2%, while GPA declined by 1%.