The Ibovespa slipped 1% to close at 183,966 on Thursday, posting broad-based losses after a volatile session amid a deteriorating external backdrop. US Treasury yields surged to multi-decade highs as expectations increased for another Fed rate hike this year, while concerns over energy-driven inflation persisted. Crude oil prices and global bond yields were volatile late in the session, with a bias to the upside.
In its Monetary Policy Report, the BCB noted that the recent oil price shock has not yet produced significant second-round inflation effects on the Brazilian economy, although it has had a direct impact on prices. The central bank also lowered its GDP growth forecast for 2026. At the same time, the federal government reduced the amount of funds frozen in the 2026 budget, despite lingering worries about high public spending.
On the corporate front, financial stocks ended lower, with Banco do Brasil falling 2.8%. Utilities also weakened, with Axia down 1.6%. Vale shed 1.1% as rising freight costs weighed on Brazil’s iron ore exports to Asia. Petrobras declined 0.7%, even in the face of higher international oil prices.
