9,200 Points in Four Sessions
Today’s Brazil’s Financial Morning Call arrives with the Ibovespa having recaptured nearly all the war’s damage. This is part of The Rio Times’ daily Brazil Financial Morning Call, covering Latin American financial markets.
The index has rallied 9,205 points from Friday’s low of 176,219 to Wednesday’s close of 185,424 (+1.60%), powered by a three-pronged catalyst: Brent’s collapse below $97, the 15-point US peace proposal to Iran, and Petrobras’s surge on oil-fueled earnings. Wall Street joined the rally — S&P 500 +0.62%, Nasdaq +0.85% — as gold bounced and yields eased.
Thursday is the most data-dense domestic session in weeks. The IPCA-15 at 08:00 BRT (cons: 0.29% MoM / 3.74% YoY) is the mid-month inflation gauge that feeds directly into Copom thinking. The BCB Inflation Report arrives at 07:00 BRT with updated projections. And Banxico’s rate decision at 15:00 ET (cons: 7.00% hold) is the key LatAm monetary policy event. Day 5 of Trump’s 5-day pause — the deadline that was supposed to expire today has been rendered moot by the peace proposal process.
Three Things That Matter
| Wednesday | Ibovespa +1.60% to 185,424 — 4th consecutive gain, highest close since early March. All LatAm indices green: IPC +3.67%, IPSA +2.00%, COLCAP +1.61%, MERVAL +0.98%. S&P 500 +0.62% to ~6,597. Nasdaq +0.85%. Brent crashed to ~$97 (−3%) on 15-point peace plan. WTI ~$90.64. Gold $4,453 (−1.19%). Silver $69.79 (−2.01%). 10Y ~4.37%. VIX fell to 25.57. SpaceX IPO filing imminent. Arm +13% on AI chip launch |
| Overnight | Iran called 15-point plan a “wishlist” but engagement continues through Pakistan mediation. Trump ordered 2,000 troops to region despite talks. BoJ Core CPI 2.2% (above 1.6% cons). GfK German Consumer Climate collapsed to −27.3 (prev: −24.7). French confidence fell to 89 (prev: 91). S&P futures +0.7%. Brent stabilizing near $97 |
| Today | BCB Inflation Report (07:00 BRT) + National Monetary Council Meeting (08:00). IPCA-15 (08:00 BRT, cons: 0.29% MoM / 3.74% YoY). US Jobless Claims (08:30 ET, cons: 211K). Banxico rate decision (15:00 ET, cons: 7.00% hold). KC Fed (11:00 ET). 7Y Note Auction (13:00 ET). Fed speakers: Cook (16:00), Jefferson (19:00), Barr (19:10). War Day 27. India holiday |
Where We Left Off WEDNESDAY, MAR 25 — B3 CLOSE
The Ibovespa opened at 182,528 and surged to 186,401 intraday before closing at 185,424.28 (+1.60%). The rally was broad-based — not just Petrobras this time. The index touched its highest level since early March, effectively recovering from the entire war selloff that began when the Strait of Hormuz closed.
Wall Street posted solid gains. The S&P 500 rose ~0.62% to ~6,597, the Nasdaq gained ~0.85%, and the Dow added ~0.69%. Brent crude fell ~3% to ~$97, dropping below $100 for the second time this week as the 15-point peace proposal gained traction. Gold slipped 1.19% to $4,453 and silver fell 2.01% to $69.79 — precious metals gave back Tuesday’s gains as the de-escalation trade rotated back into equities.
The LatAm rally was the broadest since before the war. Mexico’s IPC surged 3.67%, Chile’s IPSA gained 2.00%, Colombia’s COLCAP rose 1.61%, and Argentina’s MERVAL added 0.98%. Every single LatAm index closed green — a synchronized bounce that signals genuine de-escalation positioning, not just a Brazil-specific carry trade. As covered in yesterday’s Morning Call, the decoupling thesis has evolved into a full LatAm recovery trade.
Market Snapshot DATA AS OF WED, MAR 25 CLOSE
| Indicator | Close | Change |
|---|---|---|
| Ibovespa | 185,424 | +1.60% |
| USD/BRL | ~R$5.20 | ~−0.95% |
| S&P 500 | ~6,597 | +0.62% |
| Nasdaq | ~21,947 | +0.85% |
| 10Y Treasury | ~4.37% | −2 bps |
| Gold (Spot) | $4,453 | −1.19% |
| Brent Crude | ~$97 | ~−3.0% |
| Iron Ore (62%) | ~$102 | ~flat |
| DXY | ~99.4 | +0.13% |
What to Watch THURSDAY CATALYSTS
The BCB Inflation Report at 07:00 BRT is the comprehensive quarterly document with updated projections for GDP, inflation, and the balance of risks. After the cautious Copom minutes, the market will scrutinize the BCB’s oil price assumptions and whether the war has shifted the inflation risk balance enough to slow the easing cycle.
The IPCA-15 at 08:00 BRT (cons: 0.29% MoM / 3.74% YoY) is the mid-month inflation preview. If the annual rate drops to 3.74% from 4.10%, it would be the strongest signal yet that the BCB’s easing path remains clear. A miss above 4.0% would reignite doubts. US initial jobless claims at 08:30 ET (cons: 211K) are the weekly labor market pulse.
Banxico’s rate decision at 15:00 ET (cons: 7.00% hold) will reveal whether Mexico’s central bank is concerned about the IPC’s war-driven selloff and inflation pass-through. Three Fed speakers — Cook, Jefferson, and Barr — will provide forward guidance after the hawkish March hold. The overnight data was mixed: BoJ core CPI beat sharply at 2.2% (vs 1.6% cons), but German and French consumer confidence collapsed.
Ibovespa Setup TECHNICAL LEVELS
The Ibovespa closed at 185,424.28 (+1.60%). Daily RSI surged to 56.22 (MA: 47.02) — firmly in bullish territory for the first time since the war selloff began. The MACD histogram narrowed dramatically to −15.56 (MACD: −176.78, signal: −192.34) — the bullish crossover is imminent and could trigger on Thursday.
Resistance: 185,424 (current close) → 186,401 (Wednesday intraday high) → 190,100 (pre-war high area) → 191,220 (all-time high).
Support: 183,831 (upper SMA cluster) → 182,448 / 182,276 (mid-range SMAs) → 180,720 (50-day area) → 177,194 (lower SMA) → 174,795 (200-day / lower Bollinger).
Four consecutive gains totaling 9,205 points is the strongest rally since the war began. The RSI above 56 with MACD about to cross bullish suggests the recovery has momentum. However, the IPCA-15 is a potential reversal catalyst — a hot print could trigger profit-taking after the 5.2% four-day run.
Copom Watch SELIC AT 14.75% · NEXT MEETING: MAY 6-7
Today’s BCB Inflation Report will provide the full analytical framework — updated GDP, IPCA projections under multiple oil scenarios, and the conditional path for the Selic. The market consensus expects the BCB to project IPCA converging toward target by late 2027, supporting at least one more cut.
If the IPCA-15 prints at or below consensus (0.29% MoM / 3.74% YoY), the May 25 bps cut becomes the strong base case. With Brent now at $97 — well below the $110+ levels that threatened the easing cycle — the BCB’s room to continue cutting has widened materially. The Copom minutes warned about maintaining restrictive policy “for longer” — today’s data determines whether “longer” means May or beyond.
Economic Calendar THURSDAY, MAR 26
| Time | Event | Impact |
|---|---|---|
| 07:00 BRT | BCB Inflation Report — Quarterly projections for GDP, IPCA, balance of risks. Updated oil scenarios. Key for May Copom expectations | HIGH |
| 08:00 BRT | IPCA-15 (Mar, cons: 0.29% MoM / 3.74% YoY, prev: 0.84% / 4.10%). Mid-month inflation preview — below 4% annual = easing cycle confirmed. BCB National Monetary Council Meeting | HIGH |
| 08:30 ET | US Initial Jobless Claims (cons: 211K, prev: 205K). Continuing Claims (cons: 1,860K). Weekly labor market health check | MEDIUM |
| 15:00 ET | Banxico Rate Decision (cons: 7.00% hold). Key LatAm policy signal. Argentina Economic Activity (Jan, prev: +3.5%). Fed Cook (16:00), Jefferson (19:00), Barr (19:10) | HIGH |
| 10:30-13:00 | US Natural Gas Storage (10:30 ET, cons: −49B). KC Fed Mfg (11:00 ET). 7Y Note Auction (13:00 ET). BRL FX Flows (13:30 BRT). War Day 27 | MEDIUM |
Latin America Markets WEDNESDAY CLOSE
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa | 185,424 | +1.60% | 56.22 | Bullish |
| IPC (Mexico) | 68,188 | +3.67% | 52.95 | Neutral |
| COLCAP (Colombia) | 2,274 | +1.61% | 53.21 | Neutral |
| IPSA (Chile) | 10,410 | +2.00% | 44.22 | Neutral |
| MERVAL (Argentina) | 2,805,316 | +0.98% | 53.92 | Neutral |
Wednesday was the first all-green LatAm session since before the war. Mexico’s IPC +3.67% was the standout — its RSI surged from 38 to 53, exiting oversold territory in a single session. Chile’s IPSA bounced 2.00% after being the weakest LatAm market for two weeks. The COLCAP and MERVAL both crossed above RSI 53, confirming a broad regional recovery.
The Ibovespa’s RSI at 56.22 is the highest since March 6 and the first “Bullish” signal since the war selloff. As tracked in our Ibovespa market reports, the MACD bullish crossover that has been developing for three sessions should trigger on Thursday — a significant technical confirmation of the recovery.
Commodities & FX KEY MOVES
Brent fell ~3% to ~$97, its second close below $100 this week. WTI dropped to ~$90.64. The 15-point peace proposal is increasingly being treated as a credible off-ramp, even though Iran dismissed it as a “wishlist.” If Brent holds below $100 through Friday, the entire inflation pass-through narrative that threatened the BCB’s easing cycle begins to unwind.
Gold fell 1.19% to $4,453, giving back Tuesday’s gains. Silver dropped 2.01% to $69.79. Precious metals are rotating into equities as the de-escalation trade deepens. Gold’s RSI at 41.64 (MA: 31.70) shows the downtrend has moderated but hasn’t reversed — the metal remains in a bear market from its $5,000+ highs.
USD/BRL strengthened to ~R$5.20, continuing the real’s recovery. The carry trade at 14.75% is back in full force with Brent below $100 and the IPCA-15 expected to show further disinflation. If the IPCA-15 prints at or below consensus, R$5.15 is achievable this week.
DXY was marginally higher at ~99.4. The 10Y eased 2 bps to ~4.37% as the oil pullback reduced inflation expectations. VIX fell to 25.57 (−5.12%), its lowest since before Trump’s 48-hour ultimatum. The fear gauge’s decline is consistent with markets pricing a diplomatic resolution rather than a military escalation.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| The 15-point proposal has shifted from rhetoric to structured negotiation — Iran is engaging through Pakistan mediation, even while calling it a “wishlist.” Structured proposals create frameworks for compromise. Each day without escalation reduces the war premium.
Brent below $97 gives the BCB a clear runway to cut in May — If today’s IPCA-15 prints below 4% annual and the Inflation Report shows manageable oil scenarios, the May 25 bps cut becomes near-certain. Falling oil + falling inflation + rate cuts = the trifecta for EM equities. All five LatAm indices green for the first time since before the war — This is no longer a Brazil-specific carry trade. The synchronized rally across Mexico (+3.67%), Chile (+2%), Colombia (+1.6%), Argentina (+1%), and Brazil (+1.6%) signals that global funds are rotating back into LatAm as an asset class. The MACD bullish crossover is imminent — systematic buying will accelerate — The Ibovespa’s histogram at −15.56 is one session away from crossing positive. When it does, trend-following funds that sold on the signal reversal will be forced to cover. |
Iran called the proposal a “wishlist” — the gap between the sides may be unbridgeable — Trump simultaneously ordered 2,000 troops to the region while proposing peace. The mixed signals suggest the US is preparing for both outcomes. If talks collapse this week, the war premium snaps back instantly.
German and French consumer confidence collapsed — Europe is cracking — GfK fell to −27.3, French confidence to 89. These are war-induced demand shocks that will feed through to earnings and growth. A European recession would drag global risk sentiment regardless of LatAm fundamentals. A hot IPCA-15 would reverse the rally instantly — The Ibovespa has gained 5.2% in four sessions. If the mid-month CPI surprises above 0.40% MoM or 4.0% YoY, profit-taking on the 9,200-point run would be immediate and severe. Gold and silver falling while equities rally signals fragility, not health — Precious metals down 15%+ from highs, Apollo capping redemptions, and Circle crashing 19% on legislation risks. The financial plumbing is stressed even as headline equities recover. |
Positioning BOTTOM LINE
Thursday is the IPCA-15 session. After a 9,200-point, four-session rally, the mid-month inflation print is the make-or-break for whether this recovery becomes a sustained trend or triggers a healthy pullback. Below consensus = the rally extends toward 186,000-188,000. Above 4.0% YoY = immediate correction to the 183,000 support zone.
The BCB Inflation Report at 07:00 BRT will pre-set the market’s mood before the IPCA-15 drops an hour later. If the Report’s oil scenarios assume sub-$100 Brent and project IPCA converging to target, the combination with a soft IPCA-15 would be the most bullish domestic catalyst since the Copom cut itself.
The rotation has shifted again. With Brent at $97, Petrobras is no longer the index driver — domestic cyclicals (builders, banks, retailers) benefit most from falling oil and rate cut expectations. Banxico’s hold at 15:00 ET is consensus, but any surprise cut or hawkish language on inflation would move the IPC and set the tone for LatAm rate expectations.
The war is entering its fifth week. The market is now pricing diplomacy over escalation. If this bet is right, the Ibovespa’s all-time high at 191,220 is within striking distance. If it’s wrong, the 200-day SMA at ~174,795 awaits. Today’s data determines which path.
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.