TODAY’S FOCUS
The Big Picture
The Ibovespa gave back Friday’s historic 190K breakout, falling 0.88% to 188,853 as the global mood soured. Overnight, Wall Street extended the selloff — the Dow shed 822 points, IBM cratered 13% on AI disruption fears, and the VIX surged above 20. Trump’s 15% Section 122 tariffs replaced the struck-down IEEPA regime, and gold vaulted 3.4% past $5,200 on pure fear. Today’s session tests whether dip-buyers step in at the 188,500 level or the pullback deepens. Six Fed speakers hit the tape, headlined by Waller (09:10 ET) who called the March rate decision a “coin flip.” Brazil’s own FDI data (06:30 ET) and FGV Consumer Confidence (09:00 ET) set the domestic tone. CB Consumer Confidence (10:00 ET) will reveal whether U.S. households are cracking under tariff and AI anxiety.
Three Things That Matter
| 06:30 ET | Brazil Current Account & FDI (Jan) — Foreign flows data amid the R$34.3B YTD rally. Consensus: -$6.60B CA, $7.00B FDI |
| 10:00 ET | CB Consumer Confidence (Feb) — Cons: 87.4 vs 84.5 prior. Key read on consumer sentiment amid tariff chaos and AI anxiety |
| All Day | Fed speakers parade: Goolsbee (8:00), Collins & Bostic (9:00), Waller (9:10), Cook (9:35), Barkin (15:15). Watch for Section 122 tariff and rate-cut commentary |
Where We Left Off MONDAY, FEB 23 — B3 CLOSE
The Ibovespa pulled back 0.88% to 188,853 on Monday, surrendering Friday’s historic 190,534 close — the first-ever above 190,000. The retreat was driven by profit-taking after seven consecutive winning weeks and the weekend’s tariff escalation, with Trump raising Section 122 tariffs to 15% on Saturday. The index opened at 190,532, briefly touched 191,003 intraday (a new ATH), but sellers took control as Wall Street futures turned sharply negative on AI disruption fears. The session low was 188,526. RSI has cooled to 71 from Friday’s 72 but remains in overbought territory.
In New York, the damage was worse. The Dow cratered 822 points (−1.66%) to 48,804, the S&P 500 fell 1.04% to 6,837.75 (back in the red for 2026), and the Nasdaq dropped 1.13% to 22,627. IBM plunged 13.15% — its worst day since 2000 — after Anthropic’s Claude Code tool targeted COBOL modernization. CrowdStrike fell 9.8%, American Express tanked 7.2%, and the VIX surged 12% above 20. Gold was the safe haven of choice, vaulting 3.4% above $5,200. The 10-year yield fell 5bps to 4.03% as bonds rallied on growth fears. Fed Governor Waller called the March rate decision a “coin flip.”
Market Snapshot DATA AS OF MON, FEB 23 CLOSE
| Indicator | Close | Change |
|---|---|---|
| Ibovespa | 188,853 | −0.88% |
| USD/BRL | 5.1759 | −0.98% |
| S&P 500 | 6,837.75 | −1.04% |
| Nasdaq | 22,627 | −1.13% |
| 10Y Treasury | 4.03% | −5 bps |
| Gold (Apr) | ~$5,240 | +3.4% |
| Brent Crude | ~$71.09 | −0.29% |
| Iron Ore (62%) | $100.26 | −6.3% YTD |
| DXY | ~96.5 | −0.13% |
What to Watch MONDAY OVERNIGHT RECAP
Monday’s U.S. session erased Friday’s post-Supreme Court euphoria. Three forces converged: (1) Trump raised the replacement tariff to 15% under Section 122 of the Trade Act of 1974, up from the 10% announced Friday. The 150-day legal limit means Congress must act to extend them, injecting fresh uncertainty. The European Parliament paused ratification of its trade deal with the U.S. in response. (2) AI disruption fears escalated sharply — IBM plunged 13.15% (its worst day since 2000) after Anthropic’s Claude Code tool targeted COBOL modernization, CrowdStrike fell 9.8%, Microsoft dropped 3%, and American Express tanked 7.2% on research warning of massive AI-driven unemployment. (3) The VIX surged 12% above 20, signaling elevated fear. Gold was the safe haven of choice, surging 3.4% above $5,200. The 10-year yield fell 5bps to 4.03% as bonds rallied on growth fears.
Fed Governor Waller called the March rate decision a “coin flip” — a notable shift from January when he dissented against holding rates steady. Markets are pricing a 5% chance of a March cut at the next meeting (March 17-18), which is also the date of Brazil’s Copom decision.
Ibovespa Setup TECHNICAL LEVELS
The index enters Tuesday at 188,853 after Monday’s pullback from the all-time closing high of 190,534. Despite seven consecutive winning weeks and an 18.25% YTD gain, the first red candle in a week signals that the overbought condition is starting to correct. The 15% Section 122 tariffs are structurally lower than the struck-down reciprocal tariffs (which hit Brazilian exports at 50%), but Wall Street’s 1%+ selloff adds fresh downside pressure at the open.
Resistance: 191,003 (ATH intraday, Feb 23) → 191,700 (upper Bollinger Band). Support: 188,526 (Mon session low) → 186,700 (20-day EMA zone) → 183,100 (50-day SMA). RSI: Overbought territory at 71, cooling from 72. Prior reversals triggered at 73-75. Volume on Friday was R$36.2B — if today’s turnover drops below R$25B, conviction is fading.
Copom Watch NEXT MEETING: MAR 17-18
The Selic sits at 15.00%. Today’s current account and FDI data (06:30 ET) will provide the latest read on external flows — critical because the R$34.3B YTD foreign inflow story has been a pillar of the Ibovespa rally. The 15% Section 122 tariff is structurally better for Brazil than the prior regime (where Brazilian exports faced 50% duties), but Copom will need to assess whether the tariff whiplash introduces imported inflation risk via a weaker BRL. Focus survey expectations had inflation at 3.99% — just below the 4% threshold. FGV Consumer Confidence (09:00 ET) will show whether Brazilian households feel the squeeze.
Economic Calendar TUESDAY, FEB 24
| Time (ET) | Event | Impact |
|---|---|---|
| 06:30 | Current Account (Jan) — Cons: -$6.60B | Prev: -$3.36B | HIGH |
| 06:30 | FDI (Jan) — Cons: $7.00B | Prev: -$5.25B | HIGH |
| 07:00 | 1st Half-Month CPI (Feb) — Cons: 0.21% | Core: 0.27% | MEDIUM |
| 08:00 | Fed Goolsbee Speaks | MEDIUM |
| 09:00 | S&P/CS Home Price Index (Dec) — Cons: 1.3% YoY | House Price Index MoM Cons: 0.3% | MEDIUM |
| 09:00 | FGV Consumer Confidence (Feb) — Prev: 87.3 | MEDIUM |
| 09:00 | Fed Collins, Bostic Speak | MEDIUM |
| 09:10 | Fed Waller Speaks — Watch closely after “coin flip” March comment | HIGH |
| 09:35 | Fed Cook Speaks | MEDIUM |
| 10:00 | CB Consumer Confidence (Feb) — Cons: 87.4 | Prev: 84.5 | HIGH |
| 10:00 | Richmond Fed Manufacturing (Feb) — Cons: -8 | Prev: -6 | LOW |
| 13:00 | 2-Year Note Auction — Prev: 3.580% | MEDIUM |
| 14:00 | Economic Activity (Dec) — Prev: -0.3% YoY | MEDIUM |
| 15:15 | Fed Barkin Speaks | MEDIUM |
| 16:30 | API Weekly Crude Oil Stock — Prev: -0.609M | MEDIUM |
| 21:00 | President Trump Speaks | HIGH |
Latin America Markets LATEST CLOSE
| Index | Close | Change | RSI (14) | Signal |
|---|---|---|---|---|
| Ibovespa | 188,853 | −0.88% | 71 | Overbought |
| IPC | 70,634 | −1.12% | 63 | Bullish |
| COLCAP | 2,469 | +2.10% | 64 | Bullish |
| IPSA | 10,923 | +0.63% | 47 | Neutral |
| MERVAL | 2,763,059 | −3.84% | 38 | Bearish |
The region is split. Colombia’s COLCAP surged 2.10% to 2,469 — the standout performer — while the MERVAL extended its selloff with a 3.84% drop, now down 11.6% over the past month. Mexico’s IPC pulled back 1.12% to 70,634 after flirting with all-time highs (72,111 on Feb 12). Chile’s IPSA edged up 0.63% to 10,923, holding neutral at RSI 47. The Ibovespa’s last candle shows 188,853 (−0.88%), with RSI cooling to 71 from overbought territory — suggesting the pullback from the 190K record may already be underway heading into today.
Commodities & FX KEY MOVES
Gold is the story. After closing at $5,080.90 on Friday (+1.67%), it surged another 3.4% on Monday to above $5,240 — approaching all-time highs. The combination of tariff uncertainty, AI-driven economic disruption fears, and rising geopolitical tensions has created perfect conditions for safe-haven demand. Brent held near $71 despite Trump saying he was considering a “limited military strike” against Iran. The oil market is pricing in continued U.S.-Iran tensions but also weighing the potential for a diplomatic breakthrough. Iron ore at $100.26 remains at its lowest since August 2025, weighed down by weak Chinese demand post-Lunar New Year — a headwind for Vale. DXY fell from a 4-week high on Friday after weak Q4 GDP data, hovering around the 96 support zone — a structural positive for EM currencies and the BRL.
Risk Map BULL vs BEAR
| Bull Case | Bear Case |
|---|---|
| Tariff reduction net positive — 15% Section 122 is structurally lower than the 50% Brazil-specific IEEPA tariffs that were struck down. Effective tariff rate has fallen.
Foreign flows momentum — R$34.3B YTD foreign inflows show structural EM rotation into Brazil. 15% Selic carry trade intact. DXY weakness — Dollar index stuck at 96 support, down 13%+ over the past year. Structural tailwind for BRL and EM assets. Fed Waller “coin flip” — If March cut materializes, EM risk appetite gets a fresh catalyst. |
RSI still overbought at 71 — Seven consecutive winning weeks. Monday’s pullback was shallow — prior reversals triggered at 73-75 but deeper corrections followed. Technical exhaustion risk remains.
AI disruption contagion — Monday’s IBM -13%, CrowdStrike -10%, AmEx -7% selloff shows the “AI scare trade” is broadening beyond software into financials and consulting. Section 122 uncertainty — 150-day limit creates a legislative cliff. Congress unlikely to extend, but tariff whiplash damages business confidence. Iran strike risk — Trump said Friday he’s considering a “limited military strike.” Brent above $100 would reshape Copom’s inflation calculus. |
Positioning BOTTOM LINE
The Ibovespa already gave back Friday’s record — closing Monday at 188,853 after briefly touching a new ATH at 191,003 intraday. The index must now absorb a second wave: Wall Street’s 1%+ selloff on AI disruption and tariff fears, with the VIX above 20. The structural story remains intact — the effective tariff rate on Brazilian exports has fallen, foreign flows are running at record pace (R$34.3B YTD), and the BRL at 5.17 is at its strongest in nearly two years. But RSI at 71 is still overbought, and the 188,500 level (Monday’s session low) is the first line of defense. Key catalysts today: Brazil’s FDI data at 06:30 ET (does the flow story hold?), FGV Consumer Confidence at 09:00 ET, CB Consumer Confidence at 10:00 ET (is the U.S. consumer cracking?), and six Fed speakers who will shape March expectations. Nvidia earnings on Wednesday loom as the week’s main event. Bias: dip-buyers have a case, but the pullback may have further to run..