By Brazil Stock Guide – Brazil’s benchmark stock index, the Ibovespa, closed sharply higher on Thursday, surpassing 142,000 points for the first time in history. The index rose 1.32% to finish at 141,049.2 points, with an intraday peak of 142,138.27 points. Trading volume totaled R$22.69 billion, in line with the month’s daily average of R$22.86 billion, Reuters reported.
The rally was primarily fueled by solid performances in financial stocks, including heavyweights like Itaú Unibanco (ITUB4), Bradesco (BBDC3), and Banco do Brasil (BBAS3). Additionally, shares of Ultrapar (UGPA3), Vibra (VBBR3), and Raízen (RAIZ4) surged amid a high-profile operation targeting fuel industry fraud, which bolstered market sentiment.
Investors also reacted to political developments ahead of Brazil’s 2026 presidential elections, with a new poll showing a competitive race between President Luiz Inácio Lula da Silva and São Paulo Governor Tarcísio de Freitas. According to an AtlasIntel/Bloomberg survey, Lula leads the first round with 44.1% of voter intentions, while Tarcísio has 31.8%. However, in a second-round scenario, Tarcísio edges out Lula with 48.4% support, compared to 46.6% for the incumbent president.
Market participants have been particularly interested in Tarcísio, viewing him as a candidate with a more investor-friendly economic agenda. Marco Tulli, Superintendant at Necton/BTG Pactual, explained that positive polling data, with no significant negative news for Brazilian assets, sparked optimism. “When a favorable poll comes out, and there are no major negative news events impacting Brazilian assets, it lifts sentiment,” Tulli said. However, he noted that while the trading volume showed some improvement, investors remain cautious due to high interest rates and lingering uncertainties in the global landscape.
Gabriel Filassi, partner at AVG Capital, also highlighted the importance of the polling data. “The research showing Tarcísio ahead in a potential second round is seen positively by the market,” Filassi remarked, adding that global optimism regarding potential U.S. interest rate cuts also contributed to the positive sentiment in Brazil.
International markets were also upbeat, with Wall Street closing higher, bolstered by a new S&P 500 record and positive Nvidia (NVDA) earnings results. A revision of the U.S. GDP growth for Q2 showed the economy expanded by 3.3%, surpassing the prior 3% estimate.
Key sectoral performances on the Ibovespa included strong gains from Itaú Unibanco (ITUB4), which rose 2.08%, Bradesco (BBDC3), which gained 2.19%, and Banco do Brasil (BBAS3), which increased by 2.04%. The financial sector index surged 1.93%. Shares of Ultrapar (UGPA3), Vibra (VBBR3), and Raízen (RAIZ4) rose on the back of the massive crackdown on fraud in the fuel industry, with Ultrapar climbing 8.08%, Vibra up 4.97%, and Raízen gaining 2.83%. Petrobras (PETR3, PETR4) also saw gains, with Petrobras PN rising 0.88% and Petrobras ON adding 1.21%, in line with higher oil prices.
Meanwhile, consumer sector stocks also posted strong performance. Magazine Luiza (MGLU3) jumped 9.19%, driven by lower DI rates that benefited interest-sensitive stocks. The consumer sector index gained 1.71%. Vamos (VAMO3) advanced 7.92%, supported by an upgraded rating and higher price target from Citi.
On the downside, Reag Investimentos (REAG3), which is not part of the Ibovespa, plummeted 15.69% following the police operation. The company said it is fully cooperating with the authorities and providing the requested documents.
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