The Santiago Stock Exchange closed with gains this Thursday, despite the negative performance of its main benchmark, Wall Street, amid a sharp decline in oil prices and while the markets remained attentive to attempts to seek a diplomatic solution to the war between Russia and Ukraine.
The IPSA index, of the main stocks traded on the market, rose 0.86% to 4,936.96 points, accumulating a rise of 14.59%, the highest since the first three months of last year. In March, meanwhile, it accumulated a return of 8.8%, the highest since November 2020.
Thus, the indicator again approached 5,000 points, a mark that it has not managed to exceed since October 24, 2019.
positive outlook
Analysts estimate that if this important psychological barrier is overcome, the IPSA I could now look for the 5,500 points, in a market whose forward Price Earnings multiples remain low in relation to their historical average.
This in a context in which the appreciation of the peso against the dollar and the rise in the price of copper, the country’s main export, could continue to boost the local stock market, as well as other markets in the region that are also producers of raw materials. , whose values have benefited from the Russia-Ukraine conflict.
“We remain optimistic about the region”Pablo Riveroll, head of Latin American equities at Schroders in London, told Bloomberg.
“The growth of commodity exports, he says, is propping up the region’s faltering currencies, increasing fiscal coffers and helping to control a bout of inflation that has reduced the purchasing power of consumers. Stock valuations are still attractive,” she added.
Last Thursday in a presentation at a seminar organized by BTG Pactual, the Minister of Finance, Mario Marcel, highlighted that “in the case of the stock market, we have had a significant recovery in recent weeks, which has been among the largest in the world, but we know that the stock market is the first to respond, it is the one that responds with the greatest volatility to news of all kinds”.
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March 24, 2022/SANTIAGO BTG Pactual reopens face-to-face investment banking events, through “Latam Focus 2022”.
However, he maintained that “I think that what is interesting to highlight about all these indicators (exchange rate, long-term rates and the stock market) is that it has tended, as the electoral processes have been cleared up in the first place, the The formation of the government, the government’s agenda, have tended to moderate these risk perceptions”.
company profits
The good performance of the stock market has occurred in a context in which the slowdown in the economy and uncertainty due to the war in Europe has been contrasted by a positive closing results of companies, in which the majority of IPSA members reported advances in their earnings for 2021.
Indeed, as reported by the 28 selective companies to the Commission for the Financial Market (CMF), profits increased by 304% to US$13,732, while revenues grew 30%, totaling US$114 billion.
oil drop
The prices of Petroleum recorded a strong decline and were close to breaking the support of US$100 per barrel, in reaction to the announcement of the United States government of release your reserves to contain the increase in the value of fuels.
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FILE PHOTO: A maze of crude oil pipes and valves is pictured during a tour by the Department of Energy at the Strategic Petroleum Reserve in Freeport, Texas, U.S. June 9, 2016. REUTERS/Richard Carson – S1AETIZMOIAB/File Photo
The United States will release about a million barrels of oil a day from its reserves for six months beginning in May, a historic reduction.
President Joe Biden will also invoke Cold War powers to encourage domestic production of critical minerals for electric vehicle batteries and other uses, the White House said in a statement. Battery materials will join the list of items covered by the Defense Production Act of 1950.
Russia’s invasion of Ukraine, carried out more than a month ago, altered the market for raw materials and the price of energy, particularly natural gas and oil, which shot up highs since 2008.
Despite the fact that the measure would help reduce concerns about the sharp increase in inflationary pressures that is weighing on world growth due to the increase in the value of fuels, on Wall Street the shares reacted with losses dragged by the crude oil producing companies .
© Courtney Crow
Third
The Dow Jones Industrial Average was down 0.8%, while the selective S&P 500 fell 0.46%.
The Europe, while the Stoxx Europe 600 index fell 0.9%, closing the first quarter of the year with a decrease of 6.6% and with which it broke its longest quarterly winning streak since 1998.
This in a context in which preliminary inflation data for March released on this day reported strong increases in important countries of the bloc such as France and Italy.
Retail and bank stocks led the declines on Thursday, while utilities outperformed.