What is ERJ? Embraer S.A. is a Brazilian aerospace conglomerate that produces commercial, military, executive and agricultural aircraft and provides aeronautical services. It was founded in 1969 in São José dos Campos, São Paulo, where its headquarters are located. The company is the third-largest producer of civil aircraft, after Boeing and Airbus.
Why Brazilian Stocks Are Hopping
What happened Less than a week after Brazilian stocks plunged on COVID-19 fears, combined with a political crisis surrounding the Brazilian president, today some of these very same stocks are rebounding (all figures as of April 28th, 2:30 p.m.):
*Steelmaker Companhia Siderurgica Nacional (NYSE: SID) is up 12.2% and airplane builder Embraer Brazilian Aviation (NYSE: ERJ) is rising 11.5%. *Electric utility Companhia Energetica de Minas Gerais (NYSE: CIG) gained 10.3%, and airline Azul S.A. (NYSE: AZUL) is up 16%. *And bankers Banco Bradesco (NYSE: BBD) and Banco Santander Brasil (NYSE: BSBR) are up 11.7% and 14.5%, respectively.
So what Why are Brazilian stocks rebounding? The answer will probably surprise you: Brazil appears to be getting ready to impeach its president.
As The Washington Post reports today, Brazilian Supreme Federal Court Justice José Celso de Mello Filho has authorized Attorney General Augusto Aras to conduct a 60-day investigation into alleged corruption and obstruction of justice by President Jair Bolsonaro. Outgoing justice minister and anti-corruption crusader Sergio Moro had accused the president of firing his chief of federal police for failing to quash investigations into alleged embezzlement by the president's own sons, sparking Moro's own resignation.
Now the machinery has been set in motion to investigate these charges and potentially dig up enough evidence to justify an impeachment of the president.