Add as a preferred source on GoogleDaswani Sees Brazil Opening Selloff as Buying Opportunity After Lula Win
He tied the risk to trades built around Bolsonaro’s expected victory and stronger fiscal discipline, while citing rates, commodities and critical minerals as longer-term supports.
Gavekal Research analyst Rohan Daswani said investors should view a potential drop in Brazilian shares as a buying opportunity after Lula’s unexpected victory over Bolsonaro, while warning that the market could see sharp selling at the open.
Daswani said traders had positioned for Bolsonaro to win and for fiscal discipline to improve. He said those positions could unwind after the result, even though he still sees a longer-term case for Brazil.
He pointed to unusually high nominal and real interest rates, Brazil’s commodity exposure and its growing role in critical-mineral supply chains. Daswani also said Congress is more conservative than the president, limiting the scope for a major leftward shift in economic policy.
Brazil’s stock market is scheduled to open at 9 a.m. ET (13:00 UTC) Monday, Oct. 26.
Enna Lee
ReporterEnna Lee reports on investing and digital-asset markets for TokenPost. Send corrections or tips to info@tokenpost.com.