The Stock Exchange is going through a very complicated situation in Brazil, since the outbreak of the Coronavirus pandemic gained strong attention worldwide.
According to a report by the Online Portal Economic value.
On Friday of last week (6), the combined market value of the companies that make up the index was R$ 3.37 trillion and this Friday (13) it reached R$ 2.87 trillion
Situation in Brazil is not pleasant at all, see below for more information about how negative this will be for Brazilians.
The first circuit breaker, as the financial market interruption mechanism is known.
According to Gq, it was activated a few minutes after the start of the trading session, when the main stock index, the Ibovespa, dropped around 11.65%.
According to information from Valor Econômico, this March 2020 alone, operations on the stock exchange have already been interrupted four times, which is a disaster for many specialists.
Stock Exchange - Urgent Measures
The circuit breaker measure was explained by consultant Zeina Latif as an attempt to contain panic in the market, interrupting the famous “herd effect”.
Which usually characterizes moments of great shock and uncertainty in the face of the market - a large number of investors trying to get rid of the papers at the same time.
What are the reasons for the “nervousness” of the market?
Without a doubt, the Coronavirus. We can also ask: what implications does the downturn in the stock market have for the real economy, for those who don't necessarily invest in stocks?
How might this work in practice?
In summary:
what happens: the increase in uncertainty leads companies to postpone investment decisions, which, in turn, has an impact on employment and income”, evaluates this Friday's G1 edition.
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