Ibovespa Hits Record High After Election Result

The Ibovespa surged nearly 7.5% to hover around the record 200,000 mark after Flávio Bolsonaro finished ahead of President Lula in the first round of the presidential election, defying most polls. The result triggered a sharp repricing of Brazilian assets. Senator Bolsonaro received 47.03% of valid votes, compared with 45.16% for President Lula. The senator is viewed by markets as more fiscally restrictive, amid elevated domestic yields and weak business activity. Bolsonaro outperformed the average of polls tracked by Goldman Sachs by more than four percentage points. Gains were broad-based, with major banks leading the index. Itaú and Banco do Brasil both soared around 8%.