Ibovespa Rises Following Selic Cut

The Ibovespa advanced nearly 1% on Thursday to trade above 186,000 as investors digest central bank comments on adjusting the interest rate calibration pace and extent. The day followed the central bank's decision Wednesday to cut the Selic rate by 0.25 percentage points to 14.50% per annum. The bank noted it must incorporate new information to define future monetary policy, highlighting the possibility of adjusting the rate's calibration cycle and emphasizing the divergence between current inflation and the target. Major banks rose, with Itaú and Banco do Brasil up 1%, while utilities advanced with Axia up over 1%. Petrobras edged lower as oil prices retreated. On the data front, the unemployment rate rose to 6.1% in the moving quarter ended March 2026 from 5.8% in the prior quarter, matching market expectations. Still, this marks the lowest rate for a quarter ended in March in the historical series, which began in 2012.

The Ibovespa lost 2% to close at 184,750 ahead of the upcoming Selic decision. The Brazilian central bank is expected to cut the Selic rate by 25 basis points after the bell, but recent high inflation data has kept some bets of a hold alive and increased the likelihood of hawkish guidance. Meanwhile, the US Fed held its benchmark interest rate in the range of 3.5% to 3.75%, citing the surge in oil prices and increased economic uncertainty from the Iran war. Major banks traded negative, with Itaú down 2.8% and Bradesco losing 2.3%. Santander shed 2.4% after missing Q1 2026 earnings forecasts. In addition, Vale plunged over 5.9% after reporting results below market expectations. Likewise, WEG lost nearly 6.7% after it recorded a decline in profits.

The Ibovespa fell near 2% to trade below 185,500 following weak quarterly reports from Vale and WEG, the US Fed's meeting, and ahead of the upcoming Selic decision. Vale plunged over 5% after reporting results below market expectations. Likewise, WEG lost nearly 6% after it recorded a decline in profits. Meanwhile, the Fed held its benchmark interest rate in the range of 3.5% to 3.75%, citing the surge in oil prices and increased economic uncertainty from the Iran war. The Brazilian central bank is expected to cut the Selic rate by 25 basis points after the bell, but recent high inflation data has kept some bets of a hold alive and increased the likelihood of hawkish guidance. Major banks traded negative, with Itaú and Bradesco losing over 2%, and Santander shed near 2% after missing Q1 2026 earnings forecasts. In contrast, Petrobras gained over 3% as energy prices rose further amid no sign that oil supply through the Strait of Hormuz would normalize soon.