Overseas investor will increase wager on B3 after Lula’s victory and entry into the 12 months exceeds BRL 100 billion
Local funds and individuals were on the short end, with a negative balance of R$ 1.9 billion
Data released by B3 this Thursday, 3rd, show that foreign investors placed another R$ 1.9 billion on the Brazilian stock exchange on the first day of trading after the results of the elections, which elected Luiz Inácio Lula da Silva as the new president.
The Ibovespa, the main index of the B3, closed up 1.31% on Monday, 31st, in the opposite direction of the American stock exchanges. The start of the day, however, was marked by tension, with the index dropping more than 2% at the opening. The turning point began at 10:30 am, the same time the New York stock exchanges open.
The initial reactions, according to data from this Thursday, were driven by the local investor, who expected a negative reaction to the victory of the PT candidate. Brazilian funds and individuals were on the selling side, with withdrawals of R$1.5 billion and R$362 million, respectively.
With the flow of Monday, the entry of foreigners in the B3 in the year becomes R$ 101.6 billion in the secondary market alone. It is the first time in the year that the amount has surpassed the R$ 100 billion mark. Considering follow-ons (subsequent offering of shares), the foreign investor has already placed R$ 119 billion on the Brazilian stock exchange.
The inflow of foreign capital into B3 on Monday was 183% higher than the daily average in October, which closed with an inflow of R$ 14.1 billion from foreigners. The month was the largest inflow since August, when the balance was R$ 16.4 billion.
End of the cycle of high interest rates, upward growth revisions and downward inflation revisions are among the factors that have placed the Brazilian stock exchange among the positive highlights of the international market. In the year, the Ibovespa accumulates an increase of 11.5%, while the main international indices are negative. The US S&P 500 has already dropped more than 20% and the Nasdaq, more than 30%.
Despite the good moment of the Brazilian market, the money of local investors has been going to fixed income, where the remuneration was pulled by the high interest rates.
According to the most recent data from Anbima referring to last week, equity funds have a negative net inflow of R$ 61.9 billion in the year and multimarket funds, of R$ 74.6 billion. Investments in fixed income funds accumulate R$ 119 billion in the year.
This flow migration has affected the management of equity funds, forcing sales, even with the consensus that the Brazilian stock market is at a historically attractive level.