FX.co ★ Ibovespa Drops Slightly Ahead of BCB

The Ibovespa saw a slight dip, decreasing by 0.1% to settle at 138,717 on Wednesday, as investors approached with caution due to rising tensions in the Middle East and ahead of important rate decisions. On the domestic front, uncertainty lingered regarding whether the Central Bank of Brazil (Copom) has reached its peak Selic rate at 14.75% or if another rate hike is imminent, which put pressure on banking stocks. Meanwhile, real estate investment trusts faced a sell-off following a provisional measure to tax FII distributions. Industrial firms like WEG experienced renewed selling pressure after a brokerage downgraded them, attributing this to weaker global demand. However, some challenges were countered by gains in the meatpacking sector, where companies like JBS and BRF—increasing by 1.8%—benefited from Brazil's recent announcement of being bird-flu-free. Additionally, shares in the energy and mining sectors remained stable due to elevated oil prices. Concurrently, the Federal Reserve's decision to maintain interest rates and reduce its projected rate-cut plans, considering trade and geopolitical challenges, introduced the potential for eventually looser global monetary policies. This provided a slight support for riskier assets.