Ibovespa Gains Ahead of Election Poll and Presidential Debate

The Ibovespa gained 0.5% to hover around 186,500 on Thursday ahead of a new election poll and presidential debate. Just days before the first round, Datafolha is due to release a new poll later in the day. Globo will also host a debate among presidential candidates at night, marking the end of the campaign. Senator Flávio Bolsonaro confirmed his attendance, while President Lula is expected to appear on a podcast at the same time and is unlikely to attend. Flávio Bolsonaro is viewed by markets as more fiscally restrictive amid elevated borrowing costs and concerns over government spending. Financials were mostly higher, with Itaú and Bradesco up about 0.5%. Petrobras also gained about 0.5% as oil prices extended gains. WEG and Rede D’Or rose about 1% each. Meanwhile, Brazil’s manufacturing sector posted its sharpest deterioration in operating conditions since April 2023, according to S&P Global PMI data.

The Ibovespa rose 1.4% to close at 186,341 on Wednesday, supported by new election polls pointing to a tighter race and softer-than-expected US PCE inflation. President Lula and Flávio Bolsonaro entered the final days before the presidential election in a technical tie in a likely second-round runoff, according to Meio/Ideia and Indexa/Broadcast polls. The Meio/Ideia poll showed the candidates separated by just 0.5 percentage point in a potential runoff. Meanwhile, US PCE inflation came in slightly below estimates, easing some concerns over further Fed rate hikes. In contrast, Brazil’s PPI rose 2.5% year-on-year in August, accelerating from a 1.9% increase in July. Major banks gained, with Itaú and BB both up 4.7% and Bradesco rising 4.1%. Utilities also advanced, with Sabesp gaining 1.4%. CSN Mineração rebounded 5.2% from Tuesday’s losses, when it lowered its production outlook, as Chinese iron ore prices rose. On the month, the Ibovespa gained 5%.

The Ibovespa rose about 1% to hover around 185,500 on Wednesday following new election polls indicating a tighter race and softer-than-expected US PCE inflation. President Lula and Flávio Bolsonaro entered the final days before the presidential election in a technical tie in a likely second round, according to Meio/Ideia and Indexa/Broadcast polls. The Meio/Ideia poll showed the candidates separated by just 0.5 percentage points in a potential runoff. Meanwhile, US PCE inflation came in slightly below estimates, easing some concerns over further Fed rate hikes. In contrast, Brazil’s PPI rose 2.5% year over year in August after increasing 1.9% in July. Major banks gained, with Itaú up more than 1% and Bradesco and BB rising over 1.5% each. Utilities also advanced, with Sabesp gaining 2%. Petrobras rose more than 1% as the oil rally resumed. Vale rebounded nearly 1% from Tuesday’s losses as Chinese iron ore prices rose.