Ibovespa Falls for Tenth Straight Session

The Ibovespa edged 0.1% lower to close at 166,784 on Monday, marking a tenth consecutive session of losses. Tensions in the Middle East persisted, with little sign of a near-term resolution. Inflationary pressures increased amid higher oil prices, weighing on financials and the broader index. Itaú shed 1.6%, Bradesco lost 1.9% and Banco do Brasil retreated 2.3%. The IBC-Br showed a slightly larger-than-expected decline, falling 0.6%, its biggest drop since May 2025. The data added to evidence of a slowing economy. Casas Bahia (-33.3%) filed for judicial recovery following a multibillion-real loss in 2Q26. Meanwhile, a Quaest poll released late Friday showed President Lula and Senator Flávio Bolsonaro in a technical tie in a potential second round of the October presidential election. The same scenario was indicated by the BTG/Nexus poll. Previous polls had shown Lula ahead of Flávio Bolsonaro, who is seen as more fiscally strict, in a potential second round.

The Ibovespa rose more than 0.5% to trade close to 168,000 on Monday, rebounding from a seven-month low with support from the energy sector. Petrobras added over 1% as oil prices rose amid persistent tensions in the Middle East. Prio (+1%) and Brava (+1%) also gained. Meanwhile, a Quaest poll released late Friday showed President Lula and Senator Flávio Bolsonaro in a technical tie in a potential second round of the October presidential election. The same scenario was indicated by the BTG/Nexus poll. Previous polls had shown Lula ahead of Flávio Bolsonaro, who is seen as more fiscally strict, in a potential second round. Heavyweight shares also supported the index, with Axia and Sabesp rising over 1% and WEG adding nearly 1%. In contrast, financials traded lower amid energy-driven inflation concerns. Itaú, Banco do Brasil and Itaúsa shed about 0.5%, while Bradesco lost 1%. Vale edged lower despite higher iron ore prices.

The Ibovespa shed 0.1% to close at 166,934 on Friday, extending its seven-month low. Oil and gas prices gained as the US threatened to intensify economic pressure on Iran, including by extending the naval blockade. Energy-driven inflationary pressures weighed on financials and other credit-sensitive shares as bond yields moved higher. Bradesco lost 0.7%, Itaúsa shed 0.4% and B3 fell 0.6%, while Itaú (+1.8%) and Banco do Brasil (+0.9%) bucked the trend. Utilities also traded lower, with Sabesp down over 2% and CPFL losing over 4.5% after reporting earnings, as growth in its industrial sector was modest and net debt rose 19.2%. Renner shed 2.6% after UBS BB abandoned its buy recommendation and cut its price target. Raízen (-4%) posted a net loss in the first quarter of fiscal 2026/27. Vale (-0.8%), Ambev (-1.1%) and Rede D’Or (-2.5%) also weighed on the index. On the upside, Petrobras rose 0.4% on higher oil prices, while Embraer added 2.4% after JPMorgan raised its price target.