Brazilian assets surge as investors bet on government change; Bolsonaro leads Lula in the first round

智通财经2026/10/05 12:36

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(1) Brazilian assets surged as investors quickly bet on a possible government change. (2) Previously, Senator Flávio Bolsonaro outperformed polling expectations in the first round of the presidential election, leading current President Lula in votes and appearing poised to win the second round scheduled for October 25. (3) After the opening in São Paulo, the Brazilian real jumped as much as 3%, outperforming all other currencies. In pre-market trading in New York, the US-listed iShares MSCI Brazil ETF rose 15%. (4) Bolsonaro, seen as more market-friendly than the leftist Lula, received 47% of the votes, while Lula got 45%. Previously, investors widely expected Lula to lead in the first round and believed a tie would already be the best result for Bolsonaro. (5) JPMorgan stated in a report that this campaign now appears to have become a case of Bolsonaro “leading and just needing to hold on”. (6) Antonina Tarassiouk, head of international economic analysis at Reams Asset Management, which manages $3.4 billions in assets, said: “This is a welcome surprise. Previously, there was a clear asymmetry in the results: either Lula would maintain the status quo, or the more market-friendly, fiscally disciplined Bolsonaro would win. Now, this gives investors a signal to further expand long positions.”

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