São Paulo stock exchange surges after Flávio Bolsonaro election result
The Ibovespa, São Paulo's main stock index, had already closed higher on Friday, but after the first-round election results in Brazil the market opened at a new record.
Brazil witnessed a dual surge on Monday morning: the stock exchange and the political landscape. Flávio Bolsonaro, son of former President Jair Bolsonaro, emerged as the leading candidate in the presidential race, with a significant edge over his opponent, Luiz Inácio Lula da Silva. This political development coincided with an 8% increase in the Ibovespa index, the primary benchmark for shares traded on Brazil's leading stock exchange, B3. On Friday, the index had also shown positive movement, up by 2.46%.
The rally is attributed to Flávio Bolsonaro's strong showing in the polls, where he secured 47% of the votes cast, nearly surpassing Lula da Silva's 45.16%. His campaign promises, which include tax cuts, measures to reduce public debt, and the privatization of state-owned companies, have bolstered investor confidence. BTG Pactual, a leading investment bank in Latin America, forecasts that a Bolsonaro victory could catalyze a 45% rise in B3's shares.
The Brazilian real also experienced a boost, trading at 4.98 reais per dollar, up from 5.22 on Friday's close. Despite Lula da Silva's administration bringing inflation under control and reducing unemployment to a record low during his third term, many Brazilians express concerns over diminishing purchasing power. The far-right Liberal Party candidate Flávio Bolsonaro garnered over 56 million votes, while Lula da Silva, representing the left-wing Workers' Party, received support from nearly 53.9 million voters.
Written by urgent.news from Euronews's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
