On Friday afternoon, the Ibovespa index sharply fell by over 3%, dipping below the 160,000 threshold. This dramatic decline marked a swift reversal from the record peaks observed earlier, driven by an abrupt reevaluation of political and financial risks, which overshadowed otherwise favorable corporate news. The announcement that Jair Bolsonaro would endorse his son, Flávio, for the 2026 presidential race dashed hopes for the emergence of a moderate opposition coalition capable of enforcing fiscal discipline. Consequently, investors demanded greater returns for the perceived heightened risk of investing in Brazil, leading to significant sell-offs. Companies particularly sensitive to interest rates and domestic market conditions suffered the most, with Banco do Brasil declining by 4.7%, Bradesco by 4.8%, B3 by 5.0%, Rede D’Or by 4.0%, and Petrobras by 2.1%. These declines erased gains from earlier in the week, after achieving three consecutive winning sessions, turning what was nearly a record-setting week into a weekly loss, as increased financing costs and political instability cast doubt on future earnings prospects.