September 01, 2020

Global Markets

Brazil reports the GDP for the second quarter and it is expected that the worst figures of all time will be announced, plummeting around 10% in each of the two bases of comparison.

If the estimate is confirmed, it will be the biggest drop recorded by Brazilian GDP since the beginning of the revised historical series, in 1996, in both confrontations, surpassing even the decline of activity during the economic recession, between 2015 and 2016, and also in the crisis 2008 global financial crisis. In addition, the national economy is expected to enter a technical recession at the end of June, after falling for the second consecutive quarter.

The financial market also digests the content of the 2021 Budget proposal, trying to understand whether the government will maintain fiscal responsibility on the horizon ahead.

 Abroad, the final August readings on industrial activity in the euro zone and in the United States (11am) give clues about the pace of economic recovery since the turn of the semester, after the rapid and sharp improvement between May and June. The purchasing managers' index (PMI) for the single currency region confirmed the preliminary estimate and stood at 51.7 in August, from 51.8 in July.

 The main European exchanges are also advancing, following the positive signal coming from the future indices of the New York stock exchanges, after a session with little brightness in Asia. The Shanghai Stock Exchange led the gains, but still rose just 0.4%, reacting to the jump in the Chinese industrial PMI calculated by Caixin, which rose to the highest level in almost a decade, at 53.1 in August, from 52.8 in July.

 A private indicator of China's manufacturing activity reached its highest level in almost a decade in August, supported by strong domestic and foreign demand and faster production activity. It is the fourth time in a row that the indicator, which measures the performance of small and private manufacturing in China, remains above the 50 dividing line, which indicates expansion of activity.

The purchasing managers' index (PMI) calculated by the media group Caixin and the Markit research institute, aimed at small private manufacturers in China, rose to 53.1 in August, from 52.8 in July.

International WTI oil futures (NYMEX: CL \ V20) are trading at $ 43.04, up 0.4%. Brent (NYMEX: BZ \ V20) also operates at an increase of + 0.9%, trading at US $ 45.71.