U.S. Stocks Gain; Peru Cabinet Dismissal Sends Shares Tumbling

Brent crude continues toward $100, remaining above $91 in Tuesday’s trading

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A roundup of the region’s stock market results on Tuesday:

🗽 On Wall Street:

Staying with the volatility with which they started the year, U.S. stock markets only got onto a winning streak in the afternoon to close with gains.

The S&P 500 (SPX) rose 0.69%, while the Nasdaq Composite (CCMPDL) gained 0.75%. The Dow Jones Industrial (INDU) closed the session with a rise of 0.78%, with the three indices marking three consecutive sessions with gains.

U.S. stock markets had closed Monday and January with their worst monthly performance since March 2020, when the pandemic began, following the Federal Reserve’s tightening of monetary policy.

However, stocks are gaining some buoyancy from companies’ quarterly reports and economic data showing that the uncertainty generated by the Fed’s speech has not affected the revival.

“In the U.S., approximately 48% of S&P 500 market cap companies have reported earnings so far. Corporate earnings continued to be surprisingly resilient despite higher input cost inflation and supply chain issues,” said Mathieu Racheter, head of equity strategy research at Julius Baer.

🔑 The Day’s Key Data:

Bitcoin (XBT) hit a two-week high as cryptocurrencies regained ground after the shock of the Federal Reserve’s announcement pointing to a further increase in interest rates.

At 15:12 New York time, the largest cryptocurrency by market capitalization was up 0.2% at $38,483.76, however, during the day it breached the $39,000 barrier, a level it has not seen for two weeks.

Confidence and risk appetite appear to be returning, according to a report from Arcane Research. Over the past week, bitcoin has traded with unusually low volatility, researchers said.

🥇 The Leader:

Chile’s Ipsa (IPSA) was the best performing stock market in Latin America on Tuesday, with gains of 1.11%, continuing its trend from last month, when it closed with a month-on-month rise of 5.6%, its best January result since 2019.

The best performing shares were in the materials, information technology and financial sectors, with SQM (SQM/B), CAP (CAP), Banco de Crédito e Inversiones (BCI) and Sonda (SONDA) shares closing with the sharpest gains.

“It is worth noting that the Central Bank of Chile reported today that the monthly economic performance index (Imacec) for December 2021 grew by 10.1% compared to the same month of the previous year, which is good news, because it is being compared with respect to a month in which the basis for comparison is demanding,” wrote analysts at Renta 4.

📉 🥇 A Bad Day:

Peru’s stock exchange (SPBLPGPT) had the worst day in the region, and was the only one to post losses.

Share prices tumbled amid the uncertainty generated by the new ministerial crisis of President Pedro Castillo, who sacked his cabinet on Monday following the resignation of Interior Minister Avelino Guillén last Friday.

“I have decided to renew the cabinet and build a new team. I am grateful for the support of @MirtyVas and the ministers of state. We will continue along the road of development for the good of the country,” Castillo tweeted, thanking his prime minister Mirtha Vásquez.

🍝 For the Dinner Table Debate:

Qatar is a country with a smaller population than the City of Buenos Aires, but it is preparing to host the most important soccer tournament in the world. According to the organizers, the country expects the arrival of more than 1.2 million visitors during the FIFA World Cup, which will be held between November and December, and will welcome at least seven teams from the Americas teams that are still competing for their ticket to the tournament.

As the end of the qualifying rounds draws near, the outlook is beginning to become clearer as to which teams will be flying to Qatar to compete for the World Cup, and many fans have already begun to do the math to attend the event. According to FIFA, among the countries from which the most tickets were ordered during the first round of sales were Argentina, Mexico, Brazil and the United States.

Bloomberg Línea has calculated how much it would cost to go to the World Cup from Latin America, and how many minimum wages would be needed to do so. Argentina, Colombia and Brazil are among the countries that would have to spend the most money to travel to soccer’s biggest event. You can see the full figures here (article in Spanish).