The private investment rate is falling and how the government spends a lot irresponsibly
On February 28, the Ibovespa He closed the trading session at 122,799 points, registering his minimum in the year 2025.
Since then, the Brazilian stock market has started a recovery trajectory, reaching 135,134 points on May 2.
On the 7th, he closed the 133,398. Given this movement, many wonder if the main index of the Brazilian scholarship has breath to sustain this trend of discharge throughout the year.
The market consensus is that yes – a position that I also share – and then explain the foundations that support my optimism.
The current level has been reached with predominant support for domestic capital flow, even with the relative Strength Index (RSI or relative force index) indicating an overcompire condition by 68.
This signals that there may be a short -term price correction with investors taking advantage of profits.
However, although the market is technically overcoming, the multiple fundamentalists do not indicate overvaluation.
THE Brazilian bag The projected profit is being negotiated at 8.1 times the projected profit (p/l Forward), below the historical average.
Considering 9% growth estimates in Ibovespa companies listed in 2025, coupled with the fall of 45 base points (0.45%) in DI with maturity in January 2029, the scenario proves favorable.
If analyst projections are confirmed and the Selic rate end the year below 15%, Ibovespa has the potential to reach between 138,000 and 142,000 points by 2026 – an estimated appreciation between 5%and 8%.
In short, there are solid reasons to believe in the continuity of this altist movement. Of course, such projection considers current conditions, aware that the environment can change by internal or external factors.
The scholarship lies in robust banking profits (with ROE equal to or greater than 20%), in the expressive dividends of companies as Petrobras (Petr4), VALE (VALE3) and Suzano (Suzb3)and in punctual fiscal relief measures – such as extraordinary collection with royalties.
On the other hand, there are pressure factors, such as the additional elevation of 50-base points in Selic to 14.75% and should further restrict consumption.
Added to this the weakness of the economic data of the China and Federal Reserve’s contractionist stance, which negatively impact commodities and reduce capital flow to emerging markets.
The tax reform agenda, scheduled for June and that can increase the load on the service sector, also features a caution bias, even if Ibovespa remains discounted.
Each rise of 50-point points in the interest rate compresses by about 3% the present value of cash flows in the most leveraged sectors-negatively impacting segments such as shopping malls, construction and retail.
For banks, the effect tends to be neutral or even positive, with an increase of approximately 40 base points in the ROE via NII (net income of interest).
Electric and telecommunications companies suffer from margin compression due to debts linked to the CDI, while tariff transfers do not occur; Construtors, in turn, already negotiate only 0.6 times their equity value.
Given this context, it is natural that the question arises: What would be the best investment investment opportunities for the investor to take advantage of this scenario?
Closing this article, I list some names that, in my view, have the potential to generate significant returns.
Banking Sector:
Itaú Unibanco (Itub4) and BANCO DO BRASIL (BBAS3) stand out. CDI spreads remain high and default has stabilized.
The sector combines profit growth with Payout Between 40%and 45%, ensuring a robust flow of dividends even in a Selic scenario at 14.75%.
THE valuation It remains attractive, with multiples close to 1.5 times the equity value.
Cellulose:
THE Suzano (Suzb3) It deserves attention. The price of cellulose is around $ 625 per ton. With the devaluation of the real, the company generates cash again, reduces its leverage and reinforces its classification thesis as Investment Grid.
Competitor Arauco’s factory stop, scheduled for June, should squeeze the global offer and support prices, favoring a positive review of EBITDA.
Oil and gas:
Petrobras follows as a relevant option. Even after the recent 4.7% cut in the price of diesel, the company tends to deliver dividend yield Out of 15% in 2025, driven by Brent around US $ 86 the barrel and discipline in capital allocation.
The new 2025-2029 Strategic Plan, scheduled for July, could bring a short -term action and catalyst repurchase program.
Electric Sector:
Highlight CEMIG (CMIG4) and Isa Energia (Isae4). Transmission and distribution companies offer cash protection in monetary tightening cycles: IPCA indexed contracts mitigate the effects of interest discharge and ensure predictability on revenue flow.
An example is Cemig’s tariff review in June, which can raise its permitted annual revenue (up to 200 base points, unlocking additional value to the semester.
High -income construction:
EZTEC (EZTC3) and Cyrela (Cyre3) They are good examples. Both negotiate with a discount between 40% and 50% compared to their equity value, serving an audience less sensitive to interest rates.
Launches in high -standard neighborhoods in São Paulo have sales speed over 25% in the quarter, and customer price transfers protect gross margins, even with high Selic.
To conclude, it is important to highlight that adverse macroeconomic variables do not necessarily imply negative performances in the stock market.
Making investment decisions based exclusively on the macro scenario can be a mistake. Allocating resources based on capital flow differs substantially from the practice of Stock Picking (selection of actions).
Therefore, it is essential to maintain a critical reading of the news and not get carried away by excessive pessimism.
Anyone who believes that Ibovespa cannot move further, perhaps failing to interpret the real signs of the market.
Source: Moneytimes
I am an author and journalist with a focus on market news. I have worked for a global news website for the past two years, writing articles on a range of topics relating to the stock market. My work has been published in international publications and I have delivered talks at both academic institutions and business conferences around the world.
