The Ibovespa fell more than 1% on Tuesday, slipping below 171,000 points as investors cut risk at the close of the first half and digested weaker fiscal data. Brazil’s gross public debt in May came in above expectations, and the consolidated public sector reported a larger-than-forecast primary deficit.
Gross debt rose to 81.1% of GDP, compared with market estimates of 80.7%, while the primary deficit reached R$56.1 billion, overshooting projections of a R$53.5 billion gap. The deterioration in the fiscal picture heightened worries about rising funding costs and sustained pressure on interest rates.
Losses were broad-based across the index, with financials among the main drags. Itaú and Bradesco each retreated more than 1%. Utilities also traded lower, with Axia down 1.5%. Other notable decliners included Ambev (-1%), WEG (-1%), and Rede D'Or (-2%). Vale and Petrobras registered more moderate declines, cushioned by firmer iron ore prices and a slight uptick in oil.
