FX.co ★ Brazilian Stocks Fall Ahead of Copom Decision

The Ibovespa fell 1.5% to close at 165,362 points, hitting a one-year low in the first session after Monday’s holiday, pressured by Petrobras and credit-sensitive stocks. Petrobras sank 4% as oil prices slumped during the break, amid indications of progress in US–Iran diplomatic talks.

Investors also focused on the upcoming Copom decision, after the first Focus Bulletin published since the election pointed to higher projections for inflation, interest rates, and the exchange rate, while economic growth forecasts were revised downward. Adding to the cautious mood, the S&P Global Brazil Manufacturing PMI for October remained in contraction territory.

Most market participants expect the benchmark Selic rate to be kept at 13.75% per year, reflecting persistent concerns about Brazil’s fiscal outlook. In the banking sector, major lenders retreated, with Itaú down 0.6% and Bradesco losing 2.2%. Utilities also declined, including Axia, which dropped 2.3%.