BLOOMBERG: Worst Month in Years for Global Stocks? Brazil Says No

Brazilian stocks are heading for their best month since January, even as global equities suffer their biggest monthly decline in six years and as oil prices are poised for the worst month since 2016.

The benchmark equity index Ibovespa is up more than 9 percent in October, helped by less political risk and expectations the administration of president-elect Jair Bolsonaro will push measures to tackle the country’s fiscal woes. Bolsonaro, a former Army captain, beat his leftist rival Fernando Haddad on Oct. 28 with 55 percent of the vote.

The Ibovespa posted the best global performance among 94 indexes over the past month, gaining 18 percent in U.S. dollar terms and 9 percent in local currency terms, according to data compiled by Bloomberg.

Franklin Templeton’s Brazil Chief Investment Officer Frederico Sampaio says the new Brazilian congress — with conservative members gaining seats — should give Bolsonaro a “reasonable base” to secure approval of economic measures that he has pledged throughout the campaign. “The local scenario should be extremely positive for earnings growth and for the Brazilian equity market,” he wrote in a report.

From now on, the market will be looking for signals from the new administration, particularly whether pension reform will be approved, said Marcos Buscaglia, founding partner of Alberdi Partners. “There is more upside.”

LINK NOTA: https://www.bloomberg.com/news/articles/2018-10-31/worst-month-in-years-for-global-stocks-brazil-says-no