FX.co ★ Ibovespa Rebounds at Week Start

On Monday, the Ibovespa index advanced by 0.8%, closing at 141,783 points, driven by gains in the industrial, commodity production, and banking sectors. This rise came as the United States eased its previous threats of imposing tariffs and export restrictions on China, thus significantly reducing the immediate threat of a trade disruption that could have adversely impacted Brazilian exporters and supply chains. Companies such as WEG, Banco do Brasil, and Embraer saw increases ranging from 1.3% to 3.1%. Additionally, major players Vale and Petrobras outperformed with gains of 1.5% and 0.8%, respectively, as the thaw in trade tensions aligned with stronger demand for commodities. This was evident from record iron-ore imports in September and a recovery in oil prices, which directly enhance Brazil’s trade terms and are expected to boost dollar revenues for mining and energy sectors. Furthermore, the increased likelihood of interest rate cuts in the US has eased global financing conditions. Domestically, a moderation in inflation expectations supports the case for a delayed and gradual shift in monetary policy, thereby extending the investment horizon for Brazilian equities.