Ibovespa drops 0.74% on profit-taking after election run

The Ibovespa index dropped 0.74% on Wednesday, 7 October 2026, closing at 204,302 points after fluctuating between 204,176 and 206,877 points. The retreat extended profit-taking that followed a rally of nearly 8% on Monday, driven by market optimism regarding changes in economic policy and a right-leaning Congress. Rising yields on long-term US Treasuries also weighed on equities in New York and Sao Paulo.

The banking sector declined broadly into the close, led by Bradesco preferred shares, which fell 3.68%. Commodity blue chips closed mixed: Petrobras preferred shares rose 0.95%, while Vale common shares fell 2.30%. Citi forecast that Vale will post third-quarter EBITDA of 3.4 billion dollars, down from 4.08 billion dollars in the previous quarter, citing lower iron ore and nickel prices. Retailer Magazine Luiza common shares gained 5.09% and homebuilder Cury rose 4.77%, while Tenda dropped 4.89% amid policy expectations tied to Senator Flavio Bolsonaro, who has not yet presented fiscal adjustment measures.

Non-resident investors injected a record 10.06 billion Brazilian reais into B3 secondary equities on Monday, 5 October, surpassing the previous record of 8.4 billion reais set on 9 April, according to Valor Data. Morgan Stanley chief Latin America equity strategist Nikolaj Lippmann told Valor that Brazilian equities could receive up to 50 billion dollars from foreign investors, or between 250 billion and 275 billion reais. Morgan Stanley upgraded Brazilian equities to overweight on Tuesday, 6 October.

Financial volume reached 40.3 billion reais on the Ibovespa and 57.1 billion reais across B3. In New York, the Dow Jones declined 0.66%, while the Nasdaq and the S&P 500 both fell 0.22%.