Analysis

Brazilian stock market and IPOs 

The Brazilian stock exchange is going through a good momentum driven by reforms in the economy which makes the business environment conducive to the emergence of new IPOs.

Learn more about the Brazilian stock exchange and expectations for 2020.

IPOs in 2019

Until September 2019, the number of share offerings in the market was one of the largest in recent years, moving over R $ 53 billion. Interestingly enough, despite the fact that the foreign investor movement in B3 (BMF-Bovespa) indicates a net outflow of funds, they were strongly present in these issuances in 2019, totaling 44% of the amount moved, equivalent to R $ 25 billion.

What to expect from the rest of the year and 2020?

The improvement in the outlook for the Brazilian economy has brought a lot of optimism to the Brazilian stock market, which is reflected in the year high. This optimism helps explain why several of these companies went to market to raise money and make investments, such as in the form of acquisitions of competitors or the expansion of current businesses.

Another big reason for this volume of negotiations has to do with the current government. Minister Paulo Guedes defends the privatization of public companies and the market momentum was favorable for several public entities, such as the Union, BNDES, Treasury, FGTS, Banco do Brasil, Caixa, and others, to sell some stakes of public companies that they have.

If economic conditions remain similar to current conditions, this movement is expected to continue for the remainder of the year. Some companies have already hired investment banks to structure their operations and several others are studying access to the capital market by the end of next year.

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