From 24/7 Wall St. · David Moadel · · 1m 20s
Brazilian Stocks Tumble After Lula Wins Fourth Term
Lula's surprise fourth term triggers 25% drop in Nu Holdings, 21% in Petrobras, and 15% in MercadoLibre.
In brief
Lula's surprise fourth term triggers 25% drop in Nu Holdings, 21% in Petrobras, and 15% in MercadoLibre. Lula's election victory causes Brazilian stocks to fall sharply as investors fear policy shifts and fiscal impacts. Originally reported by 24/7 Wall St..
Lula's Surprise Fourth Term
Lula won Brazil's presidential runoff against Senator Flávio Bolsonaro, securing a fourth term.
“Lula's surprise return to Brazil's presidency blindsided investors who had positioned for the opposite outcome”
Nu Holdings Plummets 25%
Nu Holdings stock falls 25% to $11.30 in morning trading, marking the market's toughest verdict on Brazil's financial-services outlook.
“Nu Holdings ( NYSE:NU | NU Price Prediction ) stock is down 25% to $11.30 in morning trading”
Petrobras Slides 21%
Petrobras stock drops 21% to $20.54, trailing Nu Holdings as the state-controlled oil producer faces fresh questions about government influence.
“Petrobras ( NYSE:PBR ) stock is sliding 21% to $20.54, trailing only nu holdings among the three companies”
MercadoLibre Drops 15%
MercadoLibre shares fall 15% to $1,545, a smaller decline than either Nu Holdings or Petrobras.
“MercadoLibre ( NASDAQ:MELI ) shares are falling 15% to $1,545, a smaller decline than either nu holdings or petrobras”
Brazil's Market ETF Falls 28%
The iShares MSCI Brazil ETF drops 28% to $30.66, a deeper slide than any of the three companies.
“the iShares MSCI Brazil ETF ( NYSEARCA:EWZ ) is down 28% to $30.66, a deeper slide than any of the three companies”
Investors Positioned for Bolsonaro
Investors had largely positioned for a Bolsonaro win and the economic reforms it was expected to bring.
“Investors had largely positioned for a bolsonaro win and the economic reforms it was expected to bring”
Lula's Win Raises Fiscal Concerns
Lula's win stokes fears of further tax hikes and heavier regulation on Brazilian lenders, impacting Nu Holdings.
“Lula's win stokes fears of further tax hikes and heavier regulation on brazilian lenders”
Petrobras Faces Policy Risks
Petrobras is sensitive to presidential influence with fears of renewed state intervention, fuel-price controls, and higher taxation.
“Petrobras is brazil's state controlled integrated oil company with the national government as its controlling shareholder”
What matters most
Lula's election victory causes Brazilian stocks to fall sharply as investors fear policy shifts and fiscal impacts.
