FX.co ★ Ibovespa Falls on US-Iran War Concerns

The Ibovespa fell nearly 1% on Monday, slipping below 170,000 points amid uncertainty over imminent US sanctions on Iran. The measures are expected to further restrict Iranian oil supply and could push oil prices higher, reviving inflationary pressures. According to the Focus Survey, the financial market raised its inflation forecast for 2027 to 4.25% from 4.24%. The projection for the Selic rate at the end of 2026 remained at 13.75% for the third straight week, after having previously been cut from 14%. The estimate for GDP growth in 2026 was revised down to 1.95% from 1.98%.

In equities, financial stocks retreated, with Itaú, Bradesco, Itaúsa and Banco do Brasil all losing around 1%. Petrobras slumped 4.5% as oil prices eased, with investors locking in profits ahead of the US sanctions announcement. Utilities also declined, with Sabesp shedding more than 1%. Meanwhile, a Datafolha poll indicated a potential runoff in the presidential election would be highly competitive, showing President Lula and Senator Flávio Bolsonaro in a virtual tie within the margin of error.