Overview
- Official results show Luiz Inácio Lula da Silva won the presidential runoff with 51.79% of the vote on Monday, reversing market expectations of a Bolsonaro victory.
- Brazilian markets opened with heavy losses as the Bovespa fell double digits, B3 suspended trading and widened intraday limits, the real weakened more than 8–10% versus the dollar, and bond yields rose sharply.
- The Brazilian Treasury canceled planned debt auctions for October 27–29 to reduce near-term funding stress while futures trading limits were expanded to contain volatility.
- The shock spread across the region with Argentina's Merval down roughly 5–6%, Argentine ADRs and sovereign bonds falling, and the country's risk premium jumping to about 745 points.
- Political uncertainty increased after Flávio Bolsonaro said he would seek to annul the result, leaving investors focused on who will run economic policy in the new administration and on signals about fiscal discipline that could affect inflation, borrowing costs, and imported prices.