FX.co ★ Ibovespa Plunges Amid Risk-Off Mood

The Ibovespa index fell 2.6% on Thursday, closing at 179,284 points, as escalating geopolitical tensions in the Middle East pushed oil prices back above 100 dollars per barrel. Investors moved away from risk assets amid renewed threats to shipping in the Strait of Hormuz and unsuccessful efforts by the IEA to stabilize global energy supplies.

In an effort to offset rising fuel costs, the Brazilian government announced the elimination of PIS and Cofins taxes on diesel to ease the burden on consumers. Market sentiment remained fragile after February consumer inflation came in above expectations, heightening concerns about persistent price pressures ahead of the upcoming interest rate decision.

Selling pressure was broad-based: major sectors declined, with bank stocks dropping more than 2% and industrial names such as Embraer suffering double-digit losses. Although Petrobras shares posted modest gains, investors continue to wrestle with the economic fallout from a potentially prolonged conflict that could weigh on growth and prompt a more cautious stance from the monetary authority.