US futures operate flat ahead of inflation data; retail sales in Brazil and more market topics today

Asian markets closed mixed, while New York futures indices operate close to stability on the morning of this Friday (10), with Chinese inflation data for May largely in line with expectations and ahead of the consumer price index ( US CPI) for May.

The Refinitiv consensus points to an increase of 0.7% compared to April and an increase of 8.3% on an annual basis. The core index, which disregards volatile food and energy prices, is expected to fall 0.1 percentage point to 0.5%, up 5.9% year-on-year. If the report lives up to expectations or shows slower gains, Wall Street could take that as a sign that inflation may have peaked and that the Federal Reserve may be less aggressive with the rate hike later in the year.

Chinese producer inflation in May rose in line with expectations, jumping 6.4% from a year earlier, according to data from the country’s Bureau of Statistics.

Meanwhile, Chinese consumer inflation in May also increased close to expectations. The consumer price index rose 2.1% from a year earlier, slightly below the forecast in a Reuters poll for a 2.2% rise.

European stocks fell further in today’s session, with investors digesting the latest policy meeting of the European Central Bank. The ECB on Thursday confirmed its intention to raise interest rates by 25 basis points at its July meeting, with a further increase expected in September, the scale of which will be determined by the medium-term inflation outlook.

Here, after the much lower expected IPCA, investors await retail sales data for April, with a Refinitiv consensus up 2.6% year-on-year.

In the corporate field, the Ministry of Mines and Energy released the list of the Union’s nominees for Petrobras’ Board of Directors. Eletrobras was privatized with a share offering of R$ 33.7 billion on the Stock Exchange.

Check out more highlights:

1. World Scholarships

United States

US index futures operate without a defined direction this Friday ahead of the inflation data for May. The index may adjust the bets for September’s Fomc, which still divides Wall Street. For next week’s and July’s meetings, the consensus is two 50 basis point rate hikes.

In the week so far, the Dow is down 1.9%, on track for its 10th week of declines in 11. The S&P 500 and Nasdaq Composite are down more than 2%, on their way to their ninth week of losses at 10.

Later on Friday, a preliminary consumer sentiment reading for June will be released after the stock market opens.

See the performance of futures markets:

  • Dow Jones Future (USA), -0.03%
  • S&P 500 Futures (US), +0.13%
  • Nasdaq Futures (US), +0.34%

Asia

Asian markets closed mixed, with emphasis on the appreciation of China’s shares, which led gains regionally, due to the recovery of Alibaba’s shares. The rise in Chinese stocks came despite authorities having resumed some restrictions in major cities of Beijing and Shanghai.

In addition, markets relayed Chinese inflation data for May in line with expectations, which helped boost investor sentiment.

  • Shanghai SE (China), +1.42%
  • Nikkei (Japan), -1.49%
  • Hang Seng Index (Hong Kong), -0.29%
  • Kospi (South Korea), -1.13%

Europe

European markets fall sharply after European Central Bank meeting and awaiting US inflation data.

Read also: ECB maintains interest rates, but announces that it intends to raise them in July and September

The central bank significantly raised its inflation expectations for the euro zone and lowered its growth forecasts.

Christine Lagarde, president of the ECB, yesterday did not rule out a 50 basis point (bp) increase in interest rates in the euro zone in September, during a press conference that followed the monetary decision last Thursday. According to her, the pace of increase will depend on the inflationary perspective. Should it deteriorate by then, it is possible that a more aggressive increase is appropriate, she said.

  • FTSE 100 (UK), -0.98%
  • DAX (Germany), -1.49%
  • CAC 40 (France), -1.34%
  • FTSE MIB (Italy), -2.36%

commodities

Oil prices operate slightly higher this Friday (10), against the background of fears about the new Covid-19 lockdown measures in Shanghai and solid demand for fuel in the United States, the world’s largest consumer.

  • WTI Oil, +0.21%, at $121.77 a barrel
  • Brent crude, up 0.23% at $123.33 a barrel
  • Iron ore traded on the Dalian Exchange was down 1.72% to 914.50 yuan, equivalent to US$136.66

Bitcoin

  • Bitcoin, -1.55% to $30,009.94 (from 24 hours ago)

2. Schedule

In Brazil, the retail sales data for April is released this Friday (10th) and Refinitiv’s projection is for an increase of 2.6% on an annual basis and 0.4% compared to March.

The US consumer price index will also be released on Friday.

Brazil

9 am: April retail sales, Refinitiv consensus points up 0.4% from March and up 2.6% year-on-year

9:00 am: Electoral poll – XP/Ipespe

9:00 am: Bolsonaro participates in the Second Plenary Session of the IX Summit of the Americas

USA

9:30 am: May Consumer Price Index, Refinitiv Consensus Expects Up 0.7% YoY and Up 8.3% YoY; for the core, the forecast is for an advance of 0.5% on a monthly basis and 5.9% on an annual basis

11am: Michigan Business Conditions Survey

3pm: Baker Hughes probe count

3:00 pm: Monthly federal budget balance sheet

3. Fuel PEC

Senate President Rodrigo Pacheco (PSD-MG) said last Thursday, as he left the Planalto Palace, that he will decide this weekend whether the Senate will vote on the fuel package next Monday.

The expectation is that the Senate will consider next Monday the complementary bill that establishes a ceiling for the ICMS levied on fuels. The text is part of the package presented by the Executive to try to stop the rise in fuel prices.

Guedes says the government will not be able to give readjustments to servers

Federal civil servants should not have a readjustment this year, said this Thursday (9) the Minister of Economy, Paulo Guedes. According to him, the federal government will not be able to increase the civil service in 2022 and that a possible readjustment may occur later, after the approval of the administrative reform.

PSDB officializes support for Simone Tebet’s pre-candidacy for president

The PSDB made official its support for the pre-candidacy of Senator Simone Tebet (MDB) for the Presidency of the Republic the day before. The decision took place through a vote by the national executive of the party, in Brasília.

4. Covid

Last Thursday (9), Brazil recorded 148 deaths and 45,644 cases of covid-19 in 24 hours, according to information from the consortium of press vehicles, at 8 pm.

The moving average of Covid deaths in 7 days in Brazil stood at 124, an increase of 13% compared to the level of 14 days earlier.

The moving average of new cases in seven days was 37,191, which represents an increase of 65% compared to the level of 14 days before.

The number of people fully immunized against Covid in Brazil reached 166,645,677, equivalent to 77.57% of the population.

The number of people who took at least the first dose of vaccines reached 178,778,099 people, which represents 83.22% of the population.

The booster dose was given to 95,497,318 people, or 44.45% of the population.

5. Corporate Radar

Petrobras (PETR3;PETR4)

Petrobras (PETR3;PETR4) confirmed receipt of the list of the Federal Government’s nominees, as controlling shareholder, for the State’s Board of Directors.

Caio Paes de Andrade was confirmed as the director-president, replacing José Mauro Ferreira Coelho, who was fired after just over 40 days in office.

Eletrobras (ELET3;ELET6)

Eletrobras informed that the price per share was fixed at R$ 42.00, totaling R$ 33.7 billion.

The offer marks the largest privatization of a company in Brazil in more than 20 years.

Bradesco (BBDC3;[asset=BBDC4)[ativo=BBDC4)

Bradesco’s Board of Directors (BBDC3;BBDC4) approved the payment of interim interest on equity (JCP) for the first half of 2022, in the total amount of R$ 2 billion, of which R$ 0.178723065 per common share and R$0.196595372 per preferred share.

Hi (OIBR3)

Oi (OIBR3) informed that the partial sale of UPI InfraCo (V.tal) to the Globenet Investor took place
Cabos Submarinos, whose proposal was approved as the winner by the Court of the 7th Business Court of Rio de Janeiro in a competitive judicial procedure carried out in accordance with the Amendment to the Judicial Recovery Plan approved by the creditors and approved by that court on October 5, 2020.

The value of the Transaction, considering the sum of the Primary Installment; of the Secondary Installment; Additional Primary Installments; and the fair value of the Investor Merger, totaling R$12.923 billion.

After the closing of the transaction, the Investor held 51% of the shares representing the total capital stock of V.tal, and Oi, 49% of the same shares.

(With Estadão, Reuters and Agência Brasil)

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