The Rio Times LatAm Market Brief
Tuesday, October 6, 2026
By Matthias Camenzind, Publisher
Latin America's biggest stock market jumps 7.7% to a record as the real gains 4% after Flávio Bolsonaro leads
Brazil's Ibovespa, the benchmark of the São Paulo exchange, closed up 7.70% at a record 206,912 points on Monday 5 October. It was the index's first close above 200,000 and its biggest one-day gain since 24 March 2020. The real also gained about 4% against the dollar. The move followed Sunday's first round, in which Flávio Bolsonaro won 47.0% of valid votes to President Lula's 45.2%, although almost all polls had Lula ahead. For US investors, the iShares MSCI Brazil ETF (EWZ) rose 12.5% to US$42.98, and the Petrobras ADR gained 11.5% to US$24.14. Whether the rally survives the three weeks to the 25 October runoff is the open question.
Also in today's brief
The US Supreme Court voided a ruling against ending deportation protection for Venezuelans and sent the case back to a lower court
BHP asked Chile to mediate at Escondida, the world's largest copper mine, which pauses a strike for five working days
Lima's mayor race is undecided: 27.703% against 26.841%, with 1,924 tally sheets before election judges
Chile's Treasury will sell up to US$600 million a week in October, and the peso gained 1.8%
Colombia's exports rose 15.1% to US$4.46 billion in August on gold and coal
The state of the region
If you missed the last few days
On Friday we led with the polls and the 50% line, on Saturday with the eve of the vote, and on Monday with the runoff result. Today the question is what markets have already priced in, and what the three weeks of campaigning can change.
Good morning. Monday's brief said Brazil's markets would give the first verdict on the count, and the verdict was loud. Our Morning Call has the detail: Bradesco's preferred shares rose 13.57%, Banco do Brasil 11.00% and Itaú Unibanco 10.37%, while Petrobras preferred shares gained 8.19%. Exporters lagged, with Vale down 0.97% and Suzano down 5.39%. That split shows investors read a Flávio win as good for domestic banks and bad for the dollar.
Prediction markets say the same thing. Polymarket, a crypto-based betting exchange, prices Flávio at 83.7% to win the presidency, with US$174 million traded (6 October, 2:34 a.m. ET). Those prices are bets, not polls, and the last polls had Lula ahead. Politics matters here as much as markets: the Centrão, a bloc of deal-making centre-right parties, is tilting towards Flávio. His Liberal Party won 121 lower-house seats, and with the União Brasil-PP federation he would reach 208, short of the 257 needed for a majority. PP and União Brasil meet today, Tuesday 6 October.
The campaign itself is still forming. Flávio's allies are urging him to skip most runoff debates, and Band's, scheduled for Sunday 11 October at 8 p.m. Brasília time (7 p.m. ET), is unconfirmed. None of the four defeated candidates has backed a finalist yet, and together they won about 9.1 million votes, roughly four times Flávio's lead over Lula of 2.2 million.
The data calendar is full. Brazil's trade balance for September is due at 18:00 UTC today. On Wednesday 7 October, Colombia publishes September inflation, which was 6.24% a year in August, and Peru's central bank decides on rates this week, with its rate at 4.25%. Mexico and Chile publish September inflation later this week.
Why it matters: Brazil's markets have priced in a Flávio win before a single runoff debate, so the risk now runs both ways. A narrow Lula comeback would test an index that rose 7.7% in a day, and currencies often overshoot after a political surprise. The polls missed the first round, and how the 33 million voters who stayed home will act is not known. For US holders of EWZ and Brazilian ADRs, the next three weeks decide whether Monday's gain was a re-rating or a spike.
Markets & commodities
Monday's close, 5 October, the first session after the vote. Index, FX and ADR reference: EODHD.
IBOVESPA
206,912
+7.70%; record
S&P 500
7,774
+0.66%; Monday
REAL · BR
4.99
dollar lower by 4.2%
CHILE PESO
972.6
firmer by 1.8%
EWZ · BRAZIL ETF
US$42.98
+12.5%
PETROBRAS ADR
US$24.14
+11.5%
OIL FUNDS
−2.6% / −2.3%
Brent (BNO) / WTI (USO)
GOLD
US$4,134
spot, Monday
Brazil's Monday report has the session in detail. The real closed at R$4.99 per US$1 after R$5.21 on Friday, and the Chilean peso at 972.6 per US$1 after 990.5. Oil funds fell on Monday, with the Brent fund down 2.6%, while gold held near US$4,134.
The full market reports: Brazil · Mexico · Chile · Colombia · Argentina · oil · copper
Where the countries stand
BrazilSix governor races also go to runoffs on 25 October, and Rio de Janeiro could become a seventh, depending on an electoral court ruling on former governor Anthony Garotinho's 274,411 votes.ArgentinaPrivate estimates put September inflation near 2%, after the statistics office INDEC reported 1.7% for August, the lowest in 14 months. The state-workers union ATE stops work from noon today over a Supreme Court ruling on land ownership.MexicoPresident Claudia Sheinbaum asked Washington for its evidence of shots at the US Coast Guard, as 500 Mexican troops patrol the Tamaulipas border; the US ambassador had linked the two.Chile & PeruChile's finance ministry will sell up to US$600 million a week in October after the peso slid towards 1,000 per dollar. In Peru, Lima's mayor race stays open, with Renovación Popular ahead by about 44,900 votes.ColombiaExports rose 15.1% to US$4.46 billion in August, with gold up 127% and coal up 99.4%; the United States took 27.2%.
The big moves · two stories that travel
The US Supreme Court voided a ruling against ending deportation protection for Venezuelans › On Monday 5 October the justices vacated a January ruling of the Ninth Circuit appeals court that had found the cancellation of Temporary Protected Status (TPS) for Venezuelans unlawful. TPS is a US shield from deportation that comes with a work permit. The government had counted 348,202 people under the 2023 designation and 268,156 under the 2021 one, and both terminations have already taken effect, so nothing changes on the ground today. The case goes back to the Ninth Circuit. Employers and families should not expect Venezuelan work permits to return soon, and some former holders may still apply for asylum.
BHP paused the Escondida strike by asking Chile to mediate › The mine's supervisors voted 94.8% for a strike after their union rejected BHP's last offer. BHP's request on Monday suspends the strike while mediation runs for five working days, which both sides can extend by five more. Escondida is the world's largest copper mine, and BHP and Rio Tinto, both listed in New York, are its two largest owners. A walkout would tighten copper supply to US buyers; the mediation start date has not been published.
Expat & living
What Brazil's stronger real means for your monthly budget › The central bank's reference rate, PTAX, fell 4.6% to 4.9859 reais per US$1 on Monday from 5.2238 on Friday. If you earn in dollars, the same dollars now buy fewer reais than a week ago. If you pay for imports or travel in dollars, local prices may ease over time. Whether the move lasts through the runoff is not known, so consider spreading large transfers over several weeks. Today's LatAm Expat & Nomad Daily Guide has the rates and rules.
Money, markets & business
The Dominican Republic's deficit reached US$3.2 billion by 25 September · Colombia plans a special zone in Sucre for a green aluminium complex worth US$4.8 billion to US$5.2 billion · Argentina's economy minister wants taxes cut by a further 1% of GDP next year
Politics & the state
Paraguay's Colorado Party won 187 of 263 towns but lost the capital, Asunción, by 5,024 votes · Peru's governor runoffs are set for 29 November wherever no ticket won 30% · Ecuador's president says homicides hit a weekly low of 117
The wider world, from our desks
Egypt's prime minister says the country needs no new IMF programme after December, from our Africa desk
Also from our newsroom
Today: South Africa's petrol reaches a record US$1.82 a litre in Gauteng on Wednesday ›
That's Tuesday. The runoff campaign is under way, and we will follow it day by day. Reply if something here deserves a closer look. I read every one.
Matthias Camenzind
Publisher, The Rio Times
