In São Paulo, the benchmark Ibovespa index plunged as much as 17.34% intraday and triggered a 30 minute circuit breaker halt before closing down 13.9%, its steepest daily loss since 2020. Several individual Brazilian stocks lost about half of their value, including a 48% drop at one major financial firm, wiping out roughly $10 billion in wealth from the country's richest bankers and freezing about $6 billion in planned corporate equity offerings. Lula met with his finance and planning ministers late Monday as the Treasury and central bank coordinated market interventions.
The selloff followed 80 year old Lula's 51.79% to 48.21% runoff win on Sunday over conservative Senator Flávio Bolsonaro, a 4.43 million vote margin that reversed Bolsonaro's 47.03% to 45.16% first-round lead. Bolsonaro refused to concede and said his legal team would ask to annul the election after Supreme Court Justice Cristiano Zanin, Lula's former personal lawyer, extended voting hours from 5 p.m. to 7 p.m. Brasília time following requests from both campaigns, though electoral court data showed only 34,000 to 35,000 ballots were cast during the two hour window at stations that had not already locked their machines at 5 p.m.