Ibovespa Edges Higher on Petrobras Gains

The Ibovespa edged higher to trade close to 186,000 on Tuesday, lifted by gains in Petrobras. Oil prices extended a rally amid supply disruptions in the Middle East after Saudi Arabia shut down a key pipeline bypassing the Strait of Hormuz on Monday. Petrobras gained more than 1%. Meanwhile, markets expect the Selic easing cycle to continue on Wednesday, with the rate forecast to fall to 13.75% from 14%, as recent inflation data remained within the BCB’s tolerance range. In contrast, the US Fed is expected to deliver a 25-basis-point rate hike. Financial stocks were mostly muted, while utilities traded largely higher, with Sabesp rising more than 1%. Political uncertainty remained elevated amid the ongoing Supreme Court crisis, while new election polls confirmed a close presidential race between President Lula and Flávio Bolsonaro.

The Ibovespa fell 0.9% to close at 185,501 on Monday amid a rebound in oil prices and persistent political uncertainty. Oil prices rose after Saudi Arabia shut down a crucial pipeline that bypasses the Strait of Hormuz. A diplomatic meeting between Iran and Gulf Arab states to discuss the situation in Hormuz, originally scheduled for Monday in Oman, was abruptly postponed following the pipeline attack. Renewed energy-driven inflationary pressures ahead of interest-rate decisions by the BCB and the Fed weighed on credit-sensitive stocks. Major banks posted losses, with Itaú down 0.9% and Bradesco down 1.4%. Utilities also closed lower, with Eneva losing 1.5%. Political uncertainty remained elevated amid the ongoing Supreme Court crisis, while new election polls confirmed the close race for the presidency between President Lula and Flávio Bolsonaro. Brazil’s stock-market volatility index jumped 5.24%. Vale fell 3.5% as iron ore prices in China closed lower.

The Ibovespa fell about 1% to trade below 185,500 on Monday amid a rebound in the oil rally and persistent political uncertainty. Oil prices rose after Saudi Arabia shut down a crucial pipeline that bypasses the Strait of Hormuz. Renewed energy-driven inflationary pressures ahead of interest-rate decisions by the BCB and the Fed weighed on credit-sensitive stocks. Financials were mostly lower, with Banco do Brasil down more than 1%, while Itaú, Bradesco, B3 and Caixa shed about 2% each. Utilities also moved lower, with Axia losing 2% and Sabesp falling 2.5%. Political uncertainty remained elevated amid the ongoing Supreme Court crisis, while a new Datafolha poll showed President Lula maintaining a numerical lead over Senator Flávio Bolsonaro in a potential October runoff. Vale fell near 2% as ion ore prices in China closed lower. Petobras (+1%) was the only positive highlight.