Ibovespa Edges Lower on Corporate Results

The Ibovespa edged lower to hover near 175,000 on Friday amid another batch of 2Q26 earnings reports. Localiza edged lower despite reporting R$1 billion in net profit, up 30.6% from a year earlier. Renner slumped 10% after cutting its 2026 net revenue guidance as sales slowed sharply during the World Cup period. Magazine Luiza also fell nearly 5% after reporting a net loss in 2Q26 almost three times larger than in 2Q25. BB Seguridade dropped 6% after its dividend cutoff date passed on Thursday, with shares now trading ex-dividend. Bradesco BBI said the company is likely to continue facing a challenging environment after its pension business disappointed, reflecting weaker financial results. In contrast, Petrobras gained over 0.5% after beating expectations, as supply disruptions linked to the US-Iran conflict lifted second-quarter prices for crude, gasoline, and diesel. Its EBITDA rose 80% year-on-year.

The Ibovespa fell 1.2% to close at 175,546 on Thursday after the BCB signaled a cautious approach to further interest rate cuts. The Copom lowered the Selic rate by 25 basis points to 14.0% on Wednesday but stopped short of signaling another cut in September, instead reiterating that future decisions will depend on incoming data. Bond yields rose as the statement emphasized the need to maintain an appropriate degree of monetary restraint to ensure inflation converges to target and highlighted elevated global uncertainty. Financial stocks posted losses, with Itaú down 1.3%, Banco do Brasil retreating 3.7%. Bradesco fell 1.9% after reporting weaker credit quality indicators. Axia erased earlier gains to close down 1% despite reporting a rebound in net profit. Major exporters also declined after Brazil posted a weaker-than-expected trade surplus, with Vale down 1.7%, Gerdau and CSN losing 2.5%, Embraer falling 1.5%, and Minerva shedding 3%.

The Ibovespa fell 0.5% to below 177,000 on Thursday after the BCB stated that it will be cautious to deliver more rate cuts. On Wednesday, the central bank lowered the Selic rate by 25 basis points to 14.0%. Still, the Copom said it will maintain an appropriate degree of monetary restraint to ensure inflation converges to target and highlighted elevated global uncertainty. Financial stocks were mostly lower, with BB Seguridade down nearly 1%. Bradesco also lost nearly 1% after reporting a tenth consecutive quarter of profit growth, as investors focused on weaker credit quality indicators. Itaú extended gains by 1% following solid quaterly results. Axia rose over 1.5% after reporting a rebound in net profit. Petrobras gained near 1% ahead of its earnings release as oil prices rose.