Copom Cut to 14.50% · Fed Hold 3.50–3.75% (8-4 Split) · Kijun Break · Brent $126 Wartime High · UAE Exits OPEC · Meta −7% After-Hours · War Day 61
The Kijun Broke: Ibovespa Crashes Through 185K as Oil Hits $126, Powell Exits, and Copom Cuts to 14.50%
Today’s Brazil morning call opens on the other side of the most consequential Superquarta of the year — and the verdict is unambiguous: the correction has deepened into something structural. This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.
The Ibovespa didn’t just test the Kijun at 187,197 — it obliterated it, crashing to 184,504 intraday before closing at 184,750.42 (−2.05%, −3,868.27 points). The sixth consecutive decline is the longest losing streak since the war began. Open = High for the fourth straight day at 188,618/188,710 — sellers dominated from the first tick for the sixth session running. The index has now fallen 13,908 points (7.0%) from the 198,658 ATH. The next meaningful support is 183,263. Oil’s breakout above $118 on the Superquarta session has accelerated overnight to Brent $126.10 Thursday pre-market — the wartime high — after WSJ reported Trump instructed aides to prepare an extended blockade and Axios reported CENTCOM was set to brief the president on potential military action against Iran.
The Copom delivered the expected 25bp cut to 14.50% — the second consecutive reduction from the June 2025 peak of 15.00%. The comunicado struck the consensus tone: “serenidade e cautela” retained, no June commitment, Middle East flagged as elevated uncertainty. The BCB’s reference scenario uses R$5.00/USD and the yellow tariff flag. Focus IPCA 2026 has reached 4.9%. In Washington, Powell’s final press conference as Fed chair was historic: the 8-4 FOMC split — the most dissent since 1992 — with Miran voting for cuts (6th consecutive) and three regional presidents dissenting against the easing bias. Powell confirmed he will remain as governor until the DOJ investigation is “well and truly over.” Warsh advanced in the Senate Banking Committee. Today: US GDP Q1 + Core PCE (08:30 ET), ECB decision (08:15 ET), BoE decision (07:00 ET), Brazil unemployment (08:00 BRT), Brazil fiscal data (07:30 BRT), Colombia rate decision (14:00 ET), Mag 7 earnings pricing in. Brent at $126. War Day 61.
Three Things That Matter
| Yesterday | Ibovespa −2.05% to 184,750 — BROKE Kijun at 187,197, sixth consecutive decline, 7.0% from ATH. O:188,619, H:188,710, L:184,504, C:184,750. Copom cut 25bp to 14.50% (in-line), comunicado: “serenidade e cautela,” no June guidance, Middle East flagged. Fed held 3.50–3.75% in 8-4 vote — most dissent since 1992. Powell staying as governor. Warsh confirmed by Senate Banking Committee. Brent closed $118.03 (+6.5%), WTI $106.88 (+6.9%) — Trump rejected Iran’s Hormuz proposal, said blockade will continue until nuclear deal. S&P 500 −0.04% to 7,135.95. Dow −0.57% to 48,861. Nasdaq +0.04% to 24,673. USD/BRL R$4.9947 (flat). Gold −1.11% to $4,557 (1-month low). IGP-M April jumped most in 5 years |
| Overnight | Brent surged to $126.10 — wartime high. WSJ: Trump told aides to prepare extended blockade. Axios: CENTCOM to brief Trump on military options. Trump to Axios: “They are choking like a stuffed pig.” Meta −7% after-hours — capex raised to $125-145B (from $115-135B), user growth declined (blamed Iran war + WhatsApp Russia restriction). Alphabet, Amazon, Microsoft also reported after-hours. Goldman: Hormuz throughput at 4% of normal. Asia mostly lower. French GDP Q1: 0.0% QoQ (missed 0.2% cons). German retail sales −2.0% MoM (missed −0.3% cons). French CPI 2.2% YoY (above 2.0% cons) |
| Today | Eurozone CPI YoY Apr (05:00 ET, cons: 3.0% vs prev 2.6%). Eurozone GDP Q1 (05:00, cons: 0.2%). BoE Interest Rate Decision (07:00 ET, cons: hold 3.75%). Brazil Budget Balance, Net/Gross Debt-to-GDP (07:30 BRT). Brazil Unemployment Rate Mar (08:00 BRT, cons: 6.1% vs prev 5.8%). Mexico GDP Q1 (08:00, cons: −0.5% QoQ). ECB Interest Rate Decision (08:15 ET, cons: hold 2.15%) + Lagarde Press Conf (08:45). US GDP Q1 Advance (08:30 ET, cons: 2.2%). Core PCE MoM Mar (08:30, cons: 0.3%). Core PCE YoY (cons: 3.2%). Personal Spending (cons: 0.9%). Initial Claims (cons: 213K). ECI Q1 (cons: 0.8%). Chicago PMI (09:45, cons: 54.8). Colombia Interest Rate Decision (14:00 ET, cons: 11.75%). Brazil FX Flows (13:30 BRT). Last trading day of April. War Day 61 |
Where We Left Off WEDNESDAY, APR 29 — SUPERQUARTA SESSION CLOSE
Wednesday delivered the decisive break that yesterday’s Morning Call flagged as the day’s central risk. The Ibovespa opened at 188,618.69, matching the high at 188,709.96 within minutes — the fourth consecutive Open = High session — and then sold off without respite to an intraday low of 184,504.18. The close at 184,750.42 (−2.05%, −3,868.27 points) represents the largest single-day point loss since March 3, the war’s opening session. The Kijun/Tenkan convergence at 187,197 — the level this newsletter has tracked as “THE level” for two consecutive weeks — was breached by over 2,693 points intraday. This is not a marginal break but a decisive regime change: the support that held five consecutive declines gave way, and the 4,200-point intraday range is the widest since early March.
The Copom delivered at 17:30 BRT — after B3’s close at 17:00 — exactly what the market expected: a 25bp cut to 14.50%, the second consecutive reduction from the 15.00% peak. The comunicado’s key language: economic activity shows a trajectory of moderating growth; headline and core inflation have accelerated further from target; the Middle East conflict and its oil-price effects are a primary source of uncertainty. The BCB’s reference scenario projects IPCA at 3.5% for Q4 2027 using R$5.00/USD and the yellow tariff flag. Focus IPCA 2026 stands at 4.9% after seven consecutive weekly increases. The Copom stated it will incorporate new information on the “depth and extent” of the conflict — which, with Brent now at $126 overnight, makes June’s cut entirely conditional on oil stabilizing.
In Washington, Jerome Powell’s final press conference as Fed chair was the most dramatic since 2020. The FOMC held at 3.50–3.75% in an 8-4 vote — the first four-dissenter outcome since 1992. Governor Miran dissented for the sixth straight meeting favoring cuts; three regional presidents — Hammack (Cleveland), Kashkari (Minneapolis), and Logan (Dallas) — dissented against the easing bias in the statement. The statement acknowledged “developments in the Middle East are contributing to a high level of uncertainty.” Powell confirmed he will step aside as chair when Warsh is confirmed but remain on the Board of Governors, citing the unresolved DOJ renovation investigation. The 10-year yield jumped 5bp to 4.41%. S&P 500 finished −0.04%, Dow −0.57%, Nasdaq +0.04%. Meta fell 7% after-hours on raised capex ($125-145B) and declining user growth; Alphabet, Amazon, and Microsoft also reported — those results price into Thursday’s open.
Market Snapshot DATA AS OF WED, APR 29 CLOSE / THU PRE-MARKET
| Indicator | Close / Level | Change |
|---|---|---|
| Ibovespa | 184,750.42 | −2.05% (KIJUN BREAK · 7.0% from ATH) |
| USD/BRL | R$4.9947 | +0.01% (R$5.00 PINNED) |
| S&P 500 | 7,135.95 | −0.04% (flat ahead of Mag 7) |
| Nasdaq | 24,673.24 | +0.04% (Meta −7% AH) |
| Dow Jones | 48,861.81 | −0.57% (5th straight loss) |
| Brent Crude | $118.03 → $126* | WARTIME HIGH · +6.5% Wed |
| WTI Crude | $106.88 → $110* | +6.9% Wed · Above $100 |
| Gold | $4,557 | −1.11% (1-month low) |
| Bitcoin | $75,754 | +0.01% (range-bound) |
| US 10Y Yield | 4.41% | +5bp post-Fed spike |
| Selic Rate | 14.50% | CUT 25bp (Apr 29) |
* Thursday pre-market indicative quotes. Brent June at $126.10, WTI June at $110.24 per CNBC/LSEG.
What to Watch THURSDAY CATALYSTS
Oil above $126 is the session’s dominant variable. The Ibovespa enters Thursday already 2,447 points below the Kijun at 187,197. The next meaningful support is 183,263, the March 25 swing low — 1,487 points below the close. If Brent holds above $120 through European and U.S. sessions, the Ibovespa likely tests 183K. If oil reverses on any ceasefire headline, the index could attempt to reclaim 185K–186K. Trump told Axios: “The blockade is somewhat more effective than the bombing. They are choking like a stuffed pig.” Iran has refused to reopen the Strait of Hormuz until the U.S. lifts its naval blockade. Goldman estimates Hormuz throughput has fallen to 4% of normal. The asymmetry is to the downside until the oil narrative changes.
Mag 7 after-hours earnings set the global tone. Meta fell 7% after raising capex to $125–145 billion and reporting declining user growth — blamed partly on the Iran war. Alphabet, Amazon, and Microsoft also reported. If the hyperscalers beat on AI revenue, the OpenAI skepticism narrative from Tuesday is neutralized. If they disappoint, the AI capex debate deepens and the S&P’s 9.3% April gain is at risk on the final trading day of the month.
US GDP Q1 advance + Core PCE at 08:30 ET. GDP consensus 2.2% (prev 0.5%), Core PCE QoQ consensus 4.1% (prev 2.7%). Strong GDP + hot PCE = stagflation narrative = no Fed cuts = dollar strength = EM pressure. The only bullish EM scenario is moderate GDP + soft PCE. The ECB decision (08:15 ET) and Lagarde’s press conference provide the first official ECB response to $126 oil. The BoE (07:00 ET) is expected hold at 3.75%.
Brazil fiscal data (07:30 BRT) and unemployment (08:00 BRT). Budget balance consensus: −R$148B. Gross debt-to-GDP consensus: 79.6%. Unemployment consensus: 6.1% (prev 5.8%). Colombia’s BanRep (14:00 ET) expected hold at 11.25%. Mexico GDP Q1 (08:00) consensus −0.5% QoQ — first negative quarter since pandemic. Last trading day of April. S&P on pace for 9.3% monthly gain, Nasdaq +14.3%, Dow +5.4%. The Ibovespa’s April performance has been nearly erased by the six-session selloff.
Ibovespa Setup TECHNICAL LEVELS
Wednesday: O:188,618.69, H:188,709.96, L:184,504.18, C:184,750.42 (−2.05%, −3,868.27). Open = High for the fourth straight day — sellers dominated from the first tick for the sixth session running. The 4,200-point intraday range is the widest since the March 3 war-panic session. MACD histogram deepening further from −1,042 — bearish momentum is accelerating toward a crossover. RSI at 60.53, signal at 38.54 — the main RSI remains elevated due to the preceding rally, but the signal has collapsed, confirming bearish momentum divergence. The main line will follow the signal sharply lower.
Resistance: 184,750 (Wednesday close) → 187,197 (Kijun/Tenkan — NOW RESISTANCE) → 188,619 (Wednesday open) → 189,579 (Monday close) → 198,658 (ATH).
Support: 184,504 (Wednesday low) → 183,818 (cloud base) → 183,263 (March 25 swing low — KEY) → 181,875 (deep support) → 160,534 (200-day SMA).
Copom Watch SELIC AT 14.50% · NEXT MEETING: JUNE 17–18
The Copom delivered the second consecutive 25bp cut last night, bringing Selic from 15.00% (June 2025 peak) to 14.50% in two steps. The comunicado met consensus: cautious continuation with no June commitment. Three key elements: (1) economic activity is moderating while the labor market remains resilient; (2) headline and core inflation have accelerated, moving further from target; (3) the Middle East conflict and its oil-price effects are a primary source of uncertainty. The BCB’s reference scenario projects Q4 2027 IPCA at 3.5% using R$5.00/USD and the yellow tariff flag — but Brent at $126 is far above anything implied by that scenario. Focus IPCA 2026 has reached 4.9% after seven consecutive weekly increases. Terminal Selic projections: XP at 13.50%, BTG/ASA at 13.00%.
The question is now squarely whether June’s meeting delivers a third consecutive cut or a pause. The comunicado’s language — incorporating new information on the “depth and extent” of the Middle East conflict — is the explicit conditionality clause. With oil at $126 and the IGP-M jumping the most in five years in April, the inflation trajectory has deteriorated sharply since the decision. The Copom ata (minutes) will be released next Tuesday, May 6. If oil stays above $120 through mid-May, June’s cut probability drops below 50%.
Economic Calendar THURSDAY, APR 30
| Time | Event | Impact |
|---|---|---|
| Pre-Market | French GDP Q1 0.0% QoQ (missed 0.2% cons). French CPI 2.2% YoY (above 2.0% cons). German retail sales −2.0% MoM (missed). German import prices +3.6% MoM. Spanish GDP Q1 (cons: 0.5% QoQ). German unemployment (cons: 6.3%). Italian GDP Q1 (cons: 0.1%). German GDP Q1 (cons: 0.1%). Italian CPI Apr (cons: 2.6% YoY) | MEDIUM |
| 05:00 ET | Eurozone CPI YoY Apr (cons: 3.0% vs prev 2.6%). Core CPI YoY (cons: 2.2% vs prev 2.3%). Eurozone GDP QoQ Q1 (cons: 0.2%). Unemployment Mar (cons: 6.2%) | HIGH |
| 07:00 ET | BoE Interest Rate Decision (cons: hold 3.75%). BoE MPC Minutes. BoE Gov Bailey speaks (07:30) | HIGH |
| 07:30–08:00 BRT | Brazil Net Debt-to-GDP Mar (prev: 65.5%). Gross Debt-to-GDP (cons: 79.6% vs prev 79.2%). Budget Balance (cons: −R$148.0B vs prev −R$100.6B). Brazil Unemployment Rate Mar (08:00, cons: 6.1% vs prev 5.8%). Mexico GDP QoQ Q1 (08:00, cons: −0.5%) | HIGH |
| 08:15–08:45 ET | ECB Interest Rate Decision (cons: hold 2.15%). ECB Monetary Policy Statement. ECB Press Conference (08:45) — Lagarde’s first response to $126 oil | CRITICAL |
| 08:30 ET | US GDP QoQ Advance Q1 (cons: 2.2% vs prev 0.5%). Core PCE Price Index MoM Mar (cons: 0.3% vs prev 0.4%). Core PCE YoY (cons: 3.2% vs prev 3.0%). Core PCE Prices Q1 (cons: 4.10% vs prev 2.70%). Personal Income (cons: 0.3%). Personal Spending (cons: 0.9%). Initial Claims (cons: 213K). Employment Cost Index Q1 (cons: 0.8%). GDP Price Index Q1 (cons: 3.8%) | CRITICAL |
| 09:00–09:45 ET | Chile Copper Production YoY Mar (prev: −4.8%). Chilean Manufacturing Production (cons: −1.0%). Chile Retail Sales. Chicago PMI Apr (09:45, cons: 54.8 vs prev 52.8) | MEDIUM |
| 13:30–14:00 ET | Brazil Foreign Exchange Flows (13:30 BRT, prev: −2.450B). Colombia Interest Rate Decision (14:00, cons: 11.75% vs prev 11.25%) | HIGH |
Latin America Markets WEDNESDAY CLOSE
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa (Brazil) | 184,750.42 | −2.05% | 60.53 | Kijun Break |
| IPC (Mexico) | 67,097.06 | −0.26% | 51.60 | Neutral |
| COLCAP (Colombia) | 2,144.99 | −1.03% | 49.13 | Bearish |
| IPSA (Chile) | 10,857.99 | −0.44% | 59.54 | Retreating |
| MERVAL (Argentina) | 2,838,835 | −1.07% | 52.56 | Correcting |
Latin America sold off in unison on Wednesday as oil’s surge above $118 radiated risk across the region. The Ibovespa led losses with a −2.05% decline on the Kijun break. Mexico’s IPC slipped 0.26% ahead of Thursday’s Q1 GDP release, where consensus is for a −0.5% QoQ contraction — the first negative quarter since the pandemic. Chile’s IPSA retreated 0.44% from recent highs as copper held below $10K. Colombia’s COLCAP dropped 1.03% ahead of Thursday’s BanRep decision, with RSI at 49.13 signaling fading momentum. Argentina’s MERVAL fell 1.07% but remains elevated at 2.84 million, consolidating its extraordinary 2026 rally. As covered in the latest LATAM Pulse, the oil shock’s second-round effects are now the dominant regional variable.
Commodities & FX KEY MOVES
Oil has broken into crisis territory. Brent closed at $118.03 on Wednesday (+6.5%) and surged to $126.10 in Thursday pre-market — the wartime high. WSJ reported Trump instructed aides to prepare an extended blockade; Axios reported CENTCOM was set to brief the president on military options. Trump told Axios: “They are choking like a stuffed pig.” Iran has refused to reopen the Strait of Hormuz. Goldman estimates Hormuz throughput at 4% of normal. The UAE’s OPEC exit effective May 1 reshuffles the supply equation but won’t provide immediate relief. Goldman has flagged Brent could spike to $140–150 if disruptions persist. For Brazil, the surge is a double-edged sword: Petrobras benefits directly, but headline inflation pressure threatens the entire cutting cycle.
USD/BRL at R$4.9947 — essentially unchanged on a day the Ibovespa fell 2.05% and Brent hit $118. O:4.9942, H:4.9947, L:4.9947, C:4.9947. RSI at 40.59 (signal: 33.84) — the real is oversold in favor of the dollar, meaning BRL has been stronger than technical models predict. The structural supports remain intact: 14.50% Selic, R$68B cumulative foreign inflows, Brazil’s net oil exporter status, and the carry trade math. The R$5.00 level has held for over three weeks. The disconnect between equity weakness and FX stability is the Selic carry — and the Copom just confirmed it’s cutting slowly. Watch for any break above R$5.05 as the signal that the carry trade is cracking.
Bitcoin held at $75,754 — range-bound between $72K–$77K. O:75,746, H:76,441, L:75,299, C:75,754. RSI at 60.82 (signal: 53.76) — neutral. Gold retreated to $4,557 (−1.11%), a one-month low. Rising oil-driven inflation expectations push real rate expectations higher, undermining non-yielding bullion. The Fed’s 8-4 split reinforced “higher for longer.” Gold typically underperforms when rate-cut expectations are pushed out.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| Oil reversal on ceasefire headline is the market’s largest embedded asymmetry. Any credible Iran-U.S. negotiation restart crashes Brent $15–20 in hours. The market is priced for maximum escalation — any de-escalation is a violent rally. The Ibovespa has given back 13,908 points on a single narrative (oil); a reversal of that narrative recovers 5,000+ points in days.
The BRL at R$5.00 is proving structurally bulletproof. Six consecutive equity declines, oil at $126, IPCA expectations at 4.9%, Selic cut to 14.50% — and the dollar hasn’t broken R$5.02. The carry trade holds. The foreign inflow base hasn’t cracked. Petrobras benefits from $126 Brent. Brazil’s net oil exporter status cushions the current account. Mag 7 earnings beat on AI revenue neutralizes the OpenAI scare. If Alphabet/Amazon/Microsoft beat on cloud AI revenue, the OpenAI skepticism from Tuesday is dead. Tech leadership returning on the last trading day of April’s 9.3% S&P rally lifts global risk appetite and provides a floor for EM equities. |
Oil at $126 and rising with no off-ramp visible. Trump rejected Iran’s Hormuz proposal, ordered extended blockade prep, and is being briefed on military options. Goldman flagged Brent could spike to $140–150 if disruptions persist. At $126, every central bank inflation forecast is obsolete. The BCB’s reference scenario uses ~$80 Brent — it’s $46 above that.
The Kijun break opens a 4,000-point gap with no intermediate support. The 187,197 level held for two weeks and was our stated floor. It’s now 2,447 points above the close. The next support at 183,263 contains no major intermediate levels — it’s air. A capitulation flush to 181K–183K is structurally plausible. The Copom cutting cycle is now existentially threatened. Focus IPCA at 4.9%, IGP-M at its highest jump in 5 years, oil at $126, and the comunicado’s explicit Middle East conditionality clause mean June’s cut is far from guaranteed. If the ata next Tuesday signals a pause, the Ibovespa loses the monetary easing anchor that justified the rally from 160K. |
Positioning BOTTOM LINE
The Ibovespa enters Thursday in its most vulnerable technical position since the war began on February 28. The Kijun break is a genuine regime change — the level that held through five consecutive declines gave way on Wednesday as oil’s surge to $118 made the correction’s continuation mathematically inevitable. The six-session losing streak is the longest since the conflict began. The 13,908-point decline from the ATH (7.0%) is the deepest pullback of 2026. The next support at 183,263 is 1,487 points below the close — roughly one day’s move at the current pace. The Copom delivered the expected 25bp to 14.50% but the comunicado’s conditionality clause — incorporating Middle East “depth and extent” — means June is no longer a certainty.
But the structural thesis isn’t dead. The real at R$5.00 is the proof. Six consecutive equity declines, oil at $126, IPCA at 4.9%, Selic cut to 14.50% — and the dollar hasn’t broken R$5.02. The carry trade holds. The foreign inflow base hasn’t cracked. Petrobras benefits from $126 Brent. Brazil’s net oil exporter status cushions the current account. The question is no longer whether the correction continues — it does, absent an oil reversal — but whether it remains a correction (183K floor) or becomes something structural (sub-180K). The answer is almost entirely about oil.
Bias: Bearish with R$5.00 as the floor anchor. The equity correction is real and deepening. The FX stability is extraordinary and holding. The disconnect between the two is the Selic carry. If oil stabilizes below $120, Thursday could see a relief bounce from oversold conditions toward 186K. If oil holds above $126 and the military briefing headlines escalate, 183K comes fast. Today’s GDP/PCE combo at 08:30 ET is the session’s data catalyst — stagflation prints (strong GDP + hot PCE) would pile onto the bear case. Watch Brent, not the Ibovespa. This is oil’s market now.
RT Staff Reporters · This newsletter is for informational purposes only and does not constitute investment advice. Always consult a licensed financial advisor before making investment decisions. Past performance does not guarantee future results.
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