FX.co ★ Ibovespa Hits Three-Month Low

The Ibovespa dropped 1.1% on Thursday to close at 169,186, extending its losing streak to a fourth straight session and reaching a three-month low amid mounting fiscal uncertainty. Concerns over President Lula’s reelection continued to pressure markets as investors waited for key cabinet nominations — particularly for the Finance Ministry — and clearer guidance on the fiscal framework for his next term.

In the fixed-income market, bond yields saw their sharpest increase since Monday, the first trading day after the election. Financial stocks underperformed: Bradesco fell 3.5% following two rating downgrades this week. Itaú BBA cut its recommendation from “buy” to “neutral” and reduced its price target, while JPMorgan lowered its rating from “overweight” and also trimmed its target price. Exchange operator B3 retreated 3.3%.

In the corporate sphere, Vale slipped 2.2% ahead of the release of its third-quarter earnings. Ambev dropped 4.4%: although the brewer’s profit exceeded expectations, its EBITDA came in below forecasts, disappointing the market. Petrobras edged down 0.6%, with investors overlooking the company’s record third-quarter production amid a decline in international oil prices.