June 29, 2022
Direct Treasury: In the resumption of trading, government bond prices fall on the fourth of this month

Direct Treasury: Trading in government bonds is suspended on the afternoon of the fifth day

(marchmeena29 / GettyImages)

São Paulo – Strong volatility appeared again Thursday afternoon (4) at the Tesouro Direto. At around 2:00 p.m., trading of public bonds executed by the platform was suspended. As a result, investors can buy and sell bonds just like Treasuries.

When this occurs, the treasury temporarily suspends sales and purchases to prevent the investor from closing transactions at a price that may quickly become obsolete.

Prior to the suspension of negotiations, at the opening of the business, the reward for fixed-rate banknotes due in 2026 increased from 12% per annum, in the previous cycle, to 12.06% per annum.

Likewise, in the first update of the day, the reward for the previous Treasury 2031 bond, with semi-annual interest payable, increased from 11.83% to 11.93% per annum. However, the yield offered by a short-term bond continued to be higher than the yield paid for bonds due in 2031. However, the spread fell to 20 basis points on Thursday, versus the 40 basis points seen at the stress peak of Wednesday’s session.

Among the inflation-related securities, the real yield provided by Treasury IPCA + 2026 was 5.21% per annum, compared to 5.19% per annum in yesterday’s session. At the same time, the Treasury IPCA + 2055 with the semi-annual interest payment provided a real yield of 5.29%, the same as the previous day.

Industrial production

Within the economic agenda, investors reflect the disclosure of industrial production septemberWhich decreased by 0.4% compared to August. On an annual basis, the contraction was 3.9%. The data was presented today by the Brazilian Institute of Geography and Statistics (IBGE) and represents the fourth consecutive decline in the index.

Analysts’ expectations, heard by Refinitiv, were for a contraction of 0.3% on a monthly basis and 4% on a yearly basis.

In 2021, the sector achieved an expansion of 7.5%, and in the past twelve months, 6.4%. After recording growth since the fourth quarter of 2020, industrial production in the third quarter of 2021 decreased by 1.1%.

PEC of Precatório and Ciro Gomes

After a tight vote that even got a vote in favor of Arthur Lyra (PP-AL) – who, as Speaker, could abstain – the full House this morning approved the House Basic Text. PEC Orders for Court Orders (PEC 23/2021), in the first round.

There were 312 votes in favor and 144 against. Parliamentarians still need to analyze the ten salient points made by the seats with attempts to amend the version that was voted on.

As it is the Presidential Elections Commission, it is necessary to support at least three-fifths (308 out of 513 votes) of deputies in two rounds of voting.

One of the biggest points of friction among MPs appears to have been resolved in the proposal: the payment of court orders referring to the Fund for the Maintenance and Development of Primary Education and Education Valorization (Fundef).

According to the agreement between the parliamentarians, judicial debts related to the Education Fund should be included in the list of priorities to be paid by the federal government. As a result, 40% of Fundef’s court orders will be paid in 2022, 30% in 2023, and 30% in 2024.

PEC dos Precatórios could free up more than R$90 billion of fiscal space in the 2022 budget and is seen by the federal government as key to making the Auxílio Brasil push possible – a new social program for President Jair Bolsonaro (without party) trying to pull out of a role to replace Bolsa Família.

Still on the political scene, one of the highlights of this morning was the announcement by Ciro Gomes, Vice President of the Democratic Action Party (PDT), that Suspending the initial candidacy for the presidency.

The reason, according to the politician, is that the party supported the former Presidential Election Commission. On social networks, Gomez wrote: There are times when life brings us powerful negative surprises and presents us with serious challenges. this is how I feel now. This is how I feel, at this moment, when I am faced with a decision by a large portion of the PDT seat to support the infamous PEC dos Precatórios.”

Another highlight in 5G auction implemented by the National Telecommunications Agency (Anatel) today. The country’s major telecom operator, Vivo (VIVT3), Claro and Tim (time 3), in a fierce dispute to win the 3 GHz batch of 5G technology, the most coveted in the event.

Claro took the B1 batch, 80MHz, for R$338 million. Vivo won the B2 contract for R$420 million. And TIM acquired Lot B3 for 351 million Brazilian reais.

Batch B4 was not auctioned because none of the 15 bidders submitted a bid that complied with the minimum value stated in the notice.

The three phones will have to expand the country’s fiber-optic network, launch 5G in capital cities by 2022, and fund the federal government’s private 5G network.

International dinner

Meanwhile, on the outside radar, US indicators are showing a slight rise, mostly on Thursday afternoon. The day before, they closed at record levels after the Federal Reserve said it would slow to the end of November, as the pace of its bond-buying program began in March 2020.

In this way, the US central bank indicates that it is no longer necessary to encourage the US economy to remain in good shape.

On Wednesday, for example, the Dow Jones advanced 105 points in the fifth consecutive positive session. The S&P rose 0.65%, also in the fifth consecutive session from its highs; The Nasdaq rose 1.04% on its eighth day of gains.