Brazilian Stocks Stall Near 133,000–134,500 Range After Rate Rise

Ibovespa closed at 133,397.52 points on May 7, down 0.09%. Investors reacted to a 50-basis-point Selic increase and a fresh 10% U.S. tariff on Brazilian exports.

U.S. equities rose after the Federal Reserve held rates steady, while European stocks fell on mixed earnings and China growth worries. Asian markets drifted lower ahead of U.S.–China trade talks. Those shifts shaped local risk appetite and currency flows.

Domestic financial assets underperformed as Brazil’s central bank lifted rates to a near 20-year high. Traders digested April’s services PMI at 48.9, signaling contraction. March industrial production rose 3.1% year-on-year, but investors focused on tightening bias.

Foreign investors poured R$10.8 billion ($1.93 B) into equities in 2025’s first four months but withdrew R$133.6 million ($23.86 M) in April after U.S. tariffs hit steel and aluminum.

That tug-of-war kept market swings in check and maintained Ibovespa’s range around 133,000–134,500. Exporters outperformed on a weaker real and firmer commodities.

Iron-ore and oil producers led gains, while banks and credit names lagged on higher funding costs. Real estate and consumer-finance shares also underperformed amid rate-sensitive pressures.

Ibovespa Market Outlook

Technically, Ibovespa trades above its 200-hour moving average at 130,815, signaling medium-term support. The 50- and 100-period EMAs on the hourly chart converge around 133,300, marking a key inflection zone.

Bollinger Bands contract near current levels, hinting at low volatility ahead of fresh triggers. The RSI sits at 52, avoiding overbought or oversold extremes, while the MACD line hovers near its signal, pointing to neutral momentum.

Key resistance emerges at the 61.8% Fibonacci retracement of April’s rally, near 134,500. Immediate support aligns with the lower Ichimoku cloud boundary at 133,000.

Traded volume reached 752 million shares, reflecting subdued activity as investors awaited today’s U.S. jobs report. ETF liquidity favored BOVA11, with average daily turnover of R$670 million ($119.64 M), and BOVV11, at R$156 million ($27.86 M).

Net flows into local equity ETFs remained flat amid mixed sentiment. Market participants cited central bank tightening and external trade frictions as the main catalysts.

“We expect range-bound action until clearer Fed signals emerge,” noted one São Paulo trader. Without fresh global catalysts, Ibovespa may consolidate between its technical support and resistance.

Looking ahead, investors will monitor today’s industrial production figures, U.S. nonfarm payrolls, and updates from the Switzerland trade talks. Those data points will likely dictate the index’s next directional move.

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