The Brazilian stock market faced a setback in October, with the Ibovespa index dropping 1.38% to close at 131,671.51 points. The commercial dollar also rose to R$ 5.47, dampening initial excitement over Brazil’s credit rating upgrade by Moody’s.
Investors remain concerned about Brazil’s public finances and the creation of permanent expenses with temporary revenues. The central government reported a primary deficit of R$ 22.404 billion in August.
Global factors, including the ongoing dockworkers’ strike in the U.S. and tensions in the Middle East, also impacted market performance. Despite a surge in oil prices, only a few stocks, including Petrobras, saw gains.
The banking sector experienced substantial losses, with Banco do Brasil, Bradesco, Itaú Unibanco, and Santander all declining. In contrast, Natura stood out with a 2.59% gain due to increased stake by asset manager Baillie Gifford.
As market conditions remain uncertain, investors are cautious ahead of the U.S. payroll report release. The week ahead is expected to be challenging for the Brazilian stock market.