Brazilian market fluctuates with focus on politics.

Ibovespa registers slight drop and dollar rises amid political scenario.

In the last session, the Ibovespa, the main index of the Brazilian stock exchange, closed with a slight drop of 0.07%, at 157,633 points, while the commercial dollar advanced 0.10%, quoted at R$ 5.2975. The movement reflects investor caution in the face of the domestic political environment and trade negotiations with the United States.

Domestic context and economic indicators

The market is closely monitoring the release of the Monthly Retail Trade Survey (PMC) for September, which showed mixed results among the states, with notable declines in Maranhão (-2.2%) and Roraima (-2.0%) and increases in Tocantins (3.2%) and Amapá (2.9%). In the broader retail sector, Tocantins saw a significant increase of 11.4%, while São Paulo and Paraná registered declines. This data influences expectations for monetary policy and the pace of the Brazilian economy.

Brazil-US negotiations and their impact on the market.

Another factor weighing on investor sentiment is the meeting between Brazilian Foreign Minister Mauro Vieira and US Secretary of State Marco Rubio, held on the sidelines of the G7 meeting in Niagara Falls. The talks focus on reviewing the trade tariffs imposed by the US on Brazil, which amount to 40%, with expectations of a reduction. Resolving this impasse could boost bilateral trade and improve the investment environment.

Performance of companies and sectors

Among the companies, Casas Bahia reported revenue growth and improved EBITDA in the third quarter, despite a larger-than-expected net loss due to high financial expenses. Banco do Brasil, on the other hand, presented results below expectations, with increased provisions and deterioration in asset quality, especially in rural credit, which led to a downward revision of profit projections.

Outlook for the economy and financial market

The Brazilian financial market is closely watching the minutes of the Monetary Policy Committee (Copom) and the official inflation figures for October. If inflation comes in below expectations, it opens the door for cuts in the Selic rate as early as January 2026, which could stimulate the stock market. In 2025, the Ibovespa is expected to accumulate a gain of 29,08%, the largest since 2019, driven by sectors such as oil, mining, and banking.

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