Stronger-than-expected support for President Jair Bolsonaro in the first round of Brazil's presidential election was cheered by financial markets on Monday, as the race went to an Oct. 30 runoff.
of clinching victory in the first round of voting on Sunday. Lula finished ahead of Bolsonaro by 5 percentage points, but it was tighter than most opinion polls had indicated.Bolsonaro's allies also made a strong showing in the congressional vote, potentially limiting Lula's room for dramatic policy changes if he does return to the presidency.
Some market participants anticipated that the result may push Lula to commit to more moderate economic policies, while energizing the campaign of Bolsonaro, who has promised reforms and privatizations welcomed by many investors. "I think people will see reforms as more probable" said Ricardo Lacerda, founder and CEO of investment bank BR Advisory PartnersChances of a potential Bolsonaro reelection boosted shares in state-controlled companies, in expectation they could be privatized should he secure a second term. Shares in Banco do Brasil SA
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