In addition to GDP growth in the first half of 2021, another positive point marked the Brazilian economy, foreign capital invested in the local stock market reached the amount of R$ 48 billion, not counting IPOs (initial offerings of shares) and follow-ons (secondary share offerings). It is the best performance in the history of the country, over a six-month period. The data is from B3 (the Brazilian Stock Exchange).
Various factors explain the current foreign interest in investing in Brazil; GDP growth, the return of activities that had suffered due to the coronavirus pandemic, the progress of the vaccine, the rise in international commodities and the increase in interest rates.
To get an idea of the size of foreign investment in the stock market, the previous record in a period of six months was R$ 21.5 billion, which took place in the first half of 2015. Adjusting the value for inflation, it would be equivalent to R $31.36 billion currently.
For the third month in a row, the B3 registered an increase in foreign capital invested in the country, in April it was R$ 7 billion; in May, this number rose to R$ 12.2 billion; and in June, R$ 16.6 billion.
If we take into account stock offerings, which reached R$ 17.6 billion, the balance of foreign capital investment rises to R$ 65.6 billion in the first six months of the year.
Ibovespa closed at 126,801 points in the 1st semester, a rise of 6.54% for that period. Investments made by individuals also grew and stood out, reaching a positive balance of R$5.675 billion.
The outlook is that entry of foreign capital into Brazil will continue to increase, likely due to the increase in the basic interest rates, which should be readjusted at the next Copom meeting, scheduled for August 3rd and 4th.
Written by Marcos Ferreira, content assistant at Drummond Advisors