The Ibovespa dropped more than 1% to around 204,000 points on Thursday after retail sales data came in weaker than expected. Retail sales volume in Brazil edged up just 0.1% month over month in August, well below the 0.7% increase forecast by analysts, reinforcing evidence of a gradual slowdown in economic activity.
Other key sectors pointed in the same direction: services activity slipped 0.1%, while industrial production fell 0.6%. The softness is most evident in segments that are highly sensitive to credit and financing conditions, such as furniture, household appliances, vehicles, and construction materials.
Among major retailers, Magazine Luiza led the declines, sliding 5%, while other retail names fell between 1% and 3.5%. Credit-sensitive financial stocks also weakened, with Itaú and Bradesco each losing around 2%, alongside other large financial institutions. Utilities retreated as well, with Axia down nearly 1%. Petrobras and Vale both dropped about 1%, pressured by volatile oil prices and a continued slide in iron ore prices.
