Ibovespa Rises Following Election Runoff Polls

The Ibovespa rose about 1% to near 208,000 on Friday following the release of the first polls for the presidential runoff. A Datafolha poll showed Senator Flávio Bolsonaro with 49% of voting intentions against 45% for President Lula, a statistical tie at the limit of the survey’s two-percentage-point margin of error. An Atlas/Bloomberg poll put Flávio ahead at 51.1%, compared with 45.7% for Lula, ending the statistical tie in the previous survey’s runoff scenario. Markets view Bolsonaro as more fiscally restrictive amid elevated domestic yields and weak business activity. His economic team is considering spending cuts equivalent to around 2% of GDP. Financials posted solid gains, with Banco do Brasil up nearly 2%, Bradesco and Itaú rising more than 1% and B3 adding about 2.5%. Utilities also advanced, with Axia up more than 1% and Sabesp gaining about 2%. Vale edged higher as iron ore prices stabilized after reaching multi-month lows amid weakening steel margins.