The Ibovespa climbed 1.4% to close at 188,269 on Thursday, reversing earlier losses as investors priced in a higher likelihood of a change in power in October’s presidential election. Recent polls have shown Flávio Bolsonaro gaining ground in the race, and shifting odds on Polymarket added further momentum to Thursday’s move. Markets tend to associate a potential Flávio Bolsonaro victory with tighter fiscal policy, even as high domestic interest rates and subdued business activity continue to cloud the economic outlook.
Gains were broad-based, with major banks leading the advance: Itaú rose 1.8%, Bradesco jumped 3.9%, and Banco do Brasil gained 2.8%. Utilities also finished higher, with Sabesp up 2.2%. Rede D’Or outperformed, rising 3.1%. In commodities, Petrobras advanced 1.4% on the back of higher oil prices, while Vale fell 1.1% amid a decline in iron ore prices.
