Brazil Stocks Fall 13.88% After Lula Win as Circuit Breaker Halts Trading

Brazil’s benchmark Ibovespa plunged 13.88% Monday after President Luiz Inácio Lula da Silva won Sunday’s presidential runoff, prompting a 30-minute trading halt as the market repriced political risk.

The index dropped to 169,516.43 points intraday, 17.34% below its previous close of 205,082.56, before ending the session at 176,608.23. B3, Brazil’s stock exchange, halted trading after the Ibovespa triggered its circuit breaker. The U.S. dollar rose 8.25% against the real to R$5.40.

Lula won 51.79% of valid votes, compared with 48.21% for Sen. Flávio Bolsonaro. An EWZ-linked perpetual contract on Hyperliquid also moved lower while Brazilian equities were closed, offering a price signal before the local market reopened. The derivative is tied to the iShares MSCI Brazil ETF (EWZ) and does not represent ownership of its shares.

Investors are watching Lula’s fiscal plans and his choice of finance minister.