Ibovespa Flat as US-Iran War Remains in Focus

The Ibovespa closed little changed at 173,205 on Monday as developments in the Middle East remained in focus. The US and Iran agreed to suspend recent hostilities and resume diplomatic talks after exchanging fresh attacks over the weekend. Oil prices rebounded but remained near pre-conflict levels, limiting concerns over renewed energy-driven inflation. Financial stocks led gains, with Itaú rising 0.4% and Bradesco adding 1.4%. Petrobras edged up 0.2% alongside the modest recovery in oil prices, while Vale slipped amid lower iron ore prices. Meanwhile, Ambev (-0.8%), Vivo (-1.1%), and Embraer (-2.1%) underperformed.

The Ibovespa traded little changed around the 173,300 level on Monday, with the situation in the Middle East continuing to dominate the headlines. The US and Iran agreed to suspend recent hostilities and resume diplomatic talks after both countries exchanged fresh attacks over the weekend before agreeing to halt hostilities and meet in Doha on Tuesday. Oil prices edged higher but remained near pre-conflict levels, limiting concerns over renewed energy-driven inflation. Financial stocks led gains, with Itaú Unibanco slightly higher and Bradesco up more than 0.5%. Petrobras gained nearly 0.5% on the modest rebound in oil prices, while Vale edged higher despite weaker iron ore prices. Other notable gainers included Ambev (+0.5%) and Ultrapar (+3%). Ultrapar outperformed after abandoning its acquisition process for Rumo, a decision viewed positively as it avoids a deal that could have increased leverage and pressured dividend payouts. On the downside, WEG fell nearly 1%.

The Ibovespa rose 0.8% to close at 173,295 on Friday, recovering from early losses as gains in financial stocks offset declines in heavyweight commodity shares. Bond yields edged lower as oil prices returned to pre-conflict levels amid easing supply concerns, with more tankers leaving the Strait of Hormuz. This came despite President Donald Trump accusing Iran of violating the ceasefire by targeting cargo ships transiting the strait. Earlier, Iran reaffirmed its right to control shipping through the waterway and warned Gulf states against siding with the US, a day after an attack on a vessel near Oman. Major banks led gains, with Banco do Brasil up 1.4%, Bradesco rising 1.7%, Itaú climbing 1.3%, and Santander advancing 0.6%. On the downside, Vale fell 0.6% despite stronger iron ore prices, while Petrobras dropped 1.0% on lower global oil prices. Braskem plunged 8.4% after a downgrade from Citi.