Key facts
- Brazil's stock exchange halted trading after the Ibovespa index fell 10%.
- The real weakened around 12% against the U.S. dollar.
- Interest rate futures rose sharply.
- Longer-dated Brazilian international bonds fell, with the 2056 maturity down nearly 3 cents.
- Brazil's Treasury cancelled upcoming government bond auctions.
Brazil's stock exchange halted trading on Monday after President Luiz Inacio Lula da Silva was reelected, leading to a sharp selloff in assets. The real weakened around 12% against the U.S. dollar, while Bovespa stock index futures tumbled nearly 15%. Longer-dated Brazilian international bonds also fell. The selloff reversed a rally seen earlier in the month when markets had soared on expectations of a right-wing victory. Brazil's Treasury cancelled upcoming government bond auctions due to heightened market volatility. Investors are now focused on Lula's choice of finance minister and his commitment to fiscal discipline.