The Big Three
The Ibovespa fell 0.92% to 185,600.12 (−1,717.52 points) on May’s first session — breaking below the Kijun at 187,197 for the second time in six days — as Iran’s navy reportedly fired on a U.S. warship near Jask island and oil surged back to $110. The April 30 bounce that saved the month lasted exactly zero sessions into May: the index opened at the Kijun (187,318), pushed to 187,666, then sold off to 185,538. The close at 185,600 is 1,597 points below the Kijun. The pattern is devastating: the Kijun held by 40 points (April 28), broke by 2,693 points (April 29), was reclaimed by 121 points (April 30), and now broke again by 1,597 points (May 4). The level that defined April’s entire correction continues to define May’s opening.
Iran’s Fars agency reported that two shots were fired at a U.S. warship near Jask island after it “ignored warnings” — the most direct Iran-U.S. naval confrontation since the war began — while a South Korean cargo vessel was hit in Hormuz shipping. U.S. CENTCOM denied any American ship was hit. The Iranian state media claims, whether accurate or not, represent a deliberate escalation in rhetoric: Tehran is signaling that the Hormuz closure is active and enforced, not merely rhetorical. Oil surged back to $110 from the $105 relief level of last week, erasing half the $126 → $105 reversal. The oil-equity correlation remains the Ibovespa’s dominant force: when oil rises, the non-Petrobras index sells off. PRIO surged +5.65% (top Ibovespa gainer), Petrobras rose +0.53%, but Vale crashed −3.10%, Itaú −1.79%, Bradesco −2.12%.
The Boletim Focus raised IPCA expectations for the eighth consecutive week to 4.89% — now approaching the psychologically critical 5.0% level — while Lula signed the “Novo Desenrola Brasil” debt-relief programme for 20 million families. DI futures rose across the entire curve, with long-end contracts rising up to 14 basis points — the bond market is repricing the Copom’s cutting path as oil re-escalates. The PMI recovered to 52.6 in April (expansionary territory), providing the one positive domestic datapoint. Lula is traveling to the United States for a meeting with Trump — the first bilateral summit since the war began. Hapvida crashed −7.18% (worst decliner), followed by Cyrela −4.98% and MRV −3.47% — the rate-sensitive names are being crushed as the DI curve steepens.
01 Market Snapshot
| Indicator | Value | Change |
| Ibovespa Close | 185,600.12 | −0.92% (−1,718 pts) |
| Below Kijun (187,197) | −1,597 pts | broke again (2nd time) |
| USD/BRL | R$4.968 | +0.32% · still below R$5 |
| From ATH | −13,057 pts (−6.57%) | 7th decline in 9 sessions |
| May MTD | −0.92% | red from day one |
| YTD | +15.19% | was +21.72% |
| Focus IPCA 2026 | 4.89% | 8th week rising · near 5% |
| Oil (Brent) | ~$110 | back from $105 ($126 → $105 → $110) |
| PMI (April) | 52.6 | expansionary |
02 Session — May Opens With the Kijun Breaking Again
Today’s Ibovespa today report covers the session that proved April’s bounce was a dead cat. The index opened exactly at the Kijun (187,318), briefly touched 187,666, then sold off through the support to close at 185,600. The selling was driven by the Iran-U.S. naval confrontation near Jask (Fars Agency reported shots fired at a U.S. warship; CENTCOM denied), oil surging back to $110, and the DI curve steepening across all maturities. This is The Rio Times’ continuing daily coverage of Brazil’s stock market and the broader Latin American financial markets.
The sector rotation was stark: oil names rallied (PRIO +5.65%, Petrobras +0.53%, Embraer positive) while everything else fell. Vale crashed 3.10%, dragging the mining complex. Banks sold off: Itaú −1.79%, Bradesco −2.12%. Rate-sensitive names were destroyed: Hapvida −7.18%, Cyrela −4.98%, MRV −3.47%. The DI futures curve rose up to 14bp on the long end — the bond market is pricing in that the oil re-escalation kills the Copom’s June cut. Volume at R$19.3 billion was below the 50-session average of R$22.7 billion — the selling was persistent but not panicky.
03 Dollar — R$4.97, Anchor Holds But DIs Rise
From the chart: O/H/L/C: 4.9644 (flat doji on the chart; InfoMoney reports R$4.968 on the venda). RSI at 38.51 (signal: 35.22) — oversold. MACD at 0.0049. The dollar rose slightly (+0.32% per InfoMoney) but remains below R$5.00. The more concerning signal is the DI curve: futures rose across all maturities, with 14bp on the long end. If the bond market continues to reprice the cutting cycle, the carry-trade differential narrows — and the real’s structural support weakens. The dollar below R$5 is the anchor, but the DIs rising is the crack. Support: R$4.9186 (chart floor). Resistance: R$4.9761 → R$4.9895 → R$5.0398.
04 Technical Analysis — Ibovespa Daily
From the chart: O:187,317.55, H:187,666.20, L:185,537.58, C:185,600.12 (−1,717.52, −0.92%). Red candle opening at the Kijun and closing well below it. RSI at 56.65 (signal: 41.83) — the divergence continues. MACD at 1,631.31 (signal: 180.87, histogram: −1,450.44) — worsened from −1,394. 200-day SMA at 161,041 (15.2% below). Key levels: 189,668 (resistance) → 187,298 / 187,197 (Kijun, now resistance again) → 185,600 (close) → 183,380 (next support). The Kijun at 187,197 has now been tested five times in eight sessions: held, broke, reclaimed, broke. Until it’s decisively reclaimed (close above 188K), it remains resistance.
05 News in Focus
Iran Fires at US Warship Near Jask — CENTCOM Denies Any Hit
Iran’s Fars Agency reported that two shots were fired at a U.S. warship near Jask island after it “ignored warnings” — the most direct naval confrontation claim since the war began. A South Korean cargo vessel was separately hit in Hormuz. U.S. CENTCOM denied any American ship was struck. The conflicting reports are themselves the escalation: Iran is using state media to project active enforcement of the Hormuz closure, regardless of whether the shots landed. For markets, the perception of escalation is the reality — oil surged back to $110 on the reports.
Focus IPCA: 4.89% — 8th Week Rising, Approaching 5%
The BCB’s weekly Focus survey raised IPCA expectations for the eighth consecutive week to 4.89% — now just 11bp from the psychologically critical 5.0% threshold. At 5%, the inflation narrative shifts from “above ceiling but manageable” to “de-anchored.” The Selic 2029 forecast reached 10.00%. DI futures rose across the curve, with 14bp on the long end — the sharpest single-day curve steepening since the Copom decision. The market is pricing out the June cut probability as oil re-escalates.
Lula Signs Novo Desenrola; Travels to Meet Trump; PMI Expansionary
President Lula signed the “Novo Desenrola Brasil” — a debt-relief programme targeting 20 million families — in an election-year move to address household indebtedness under the 14.50% Selic regime. Lula is traveling to the United States for his first bilateral meeting with Trump since the war began — a diplomatically significant encounter given Brazil’s position as a net oil exporter and Mercosul’s ongoing EU negotiations. The April PMI recovered to 52.6 (expansionary), the one positive domestic data point. Brazil’s oil production rose 16.3% in Q1 2026 — further strengthening the net-exporter thesis that underpins the real.
06 Looking Ahead
Itaú and Bradesco report Q1 today — the most important bank earnings of the quarter. Strong numbers could arrest the sell-off by confirming domestic earnings resilience despite the macro stress. Weak numbers would accelerate the decline toward 183,380. The Lula-Trump meeting is the geopolitical wildcard: any progress on the Iran situation via Brazil’s diplomatic channel would be bullish for oil (down) and equities (up). Petrobras Q1 on May 11 is the next major catalyst.
Key dates: Tuesday May 5 — Itaú/Bradesco Q1. May 11 — Petrobras Q1. June 17–18 — next Copom. Ongoing — Lula-Trump meeting, Iran-US naval confrontation, Hormuz status.
07 Verdict
April’s bounce lasted one session. The Kijun broke again on May’s first day. Iran is firing at warships (reportedly). Oil is back at $110. The Focus hit 4.89% for the eighth consecutive week. The DI curve steepened 14bp. May opened exactly as April ended: with the war dictating everything and the Kijun as the battleground. The seven-of-nine-sessions decline since the ATH (−13,057 points, −6.57%) has the characteristics of a persistent de-rating rather than a panic flush — the selling is orderly, the dollar holds below R$5, and the volume is below average.
Bias: Bearish — the Kijun broke again, oil is re-escalating, DIs are rising, and the Iran naval confrontation is the worst since the war began. The only catalysts that reverse this: Itaú/Bradesco earnings beat (today), Lula-Trump diplomatic progress, or oil dropping below $100. Without one of those, the path is toward 183,380 — the next chart support. The dollar at R$4.97 is the last anchor. The PMI at 52.6 is the one green light. Everything else is red. Bank earnings today answer whether the domestic economy can offset the geopolitical storm. If they can, the Kijun gets another test. If they can’t, 183K is the destination.
Related coverage:
May opening wrap: May Opens at the Kijun, Dollar at Two-Year Low
April crash: Ibovespa Crashes 2% — Worst Session of the War
April bounce: Ibovespa Bounces 1.39% as Dollar Hits Two-Year Low
Investing guide: Investing in Brazil 2026: B3, Selic, Real Estate and Risks
This report is for informational purposes only and does not constitute investment advice. Always consult a licensed financial advisor. Past performance does not guarantee future results. Published by The Rio Times.