LatAm Pre-Open — Thursday, July 23, 2026

Source: EODHD close, 2026-07-22. Figures rendered directly from the feed.

01 The overnight tape in one read

Asian markets traded without conviction on Thursday as investors digested Japanese PMI numbers. Manufacturing activity edged down while services picked up slightly, leaving the composite picture largely unchanged and the yen very weak above 162 per dollar.

That yen softness continues to lubricate the global carry trade. For Latin America, a cheap yen means the maths of borrowing in Tokyo and buying Brazilian real-denominated bonds earning 14.25% remains very attractive.

European equity futures are pointing to a flat open after a sturdy session on Wednesday. Spain’s Ibex 35, a useful temperature check for Latin American risk because of the deep financial links between Madrid and the region, closed up 1.39% at 19,650.9.

The Latibex index — which quotes Latin American shares in euros and is a pure proxy for European appetite for the region — added 0.86% to 2,710.9, reinforcing the sense that offshore demand is intact.

02 The board before the open

Wednesday’s session delivered a striking divergence. The Ibovespa — Brazil’s main stock index — roared 2.44% higher to 177,548 points, completely ignoring the S&P 500’s small 0.14% dip. The Merval in Buenos Aires was even stronger, up 2.98% to 3,379,771, taking it close to the 52-week peak.

Mexico’s IPC rose a steady 0.88% ahead of today’s inflation and activity data double-header. Only Colombia’s COLCAP slipped, losing 0.19% and staying capped below the 2,320 level that has acted as a technical ceiling since the post-election period.

03 What the data shows — WEG and CVC lead a broad domestic surge

The B3 scan shows a session where domestic cyclicals and industrials exploded higher. Travel operator CVC Brasil (CVCB3) surged 13.4% on modest turnover, the kind of move that signals traders are betting aggressively on further Selic cuts reviving consumer credit. Industrial motor manufacturer WEG (WEGE3) jumped 10.1% with enormous R$1.59 billion in volume — the second-most traded name on the exchange.

Petrobras (PETR4) topped the turnover table at R$1.63 billion, closely tailed by mining giant Vale (VALE3) at R$1.33 billion. The massive volume in these two commodity bellwethers, even without extreme price swings, suggests that foreign institutional money is actively positioning in Brazil’s most liquid large-cap names as oil stays above US$84.

04 Brazil and the currencies

The Brazilian real strengthened to 5.0546 against the dollar on Wednesday, a 0.37% gain that extends a run of resilience. With the Selic at 14.25% and inflation expectations still elevated at 5.3% for 2026, the real is trading as one of the world’s highest-yielding major currencies — exactly the kind of magnet that the global carry trade chases.

Across the region currency moves were modest but telling. The Colombian peso firmed 0.88% to 3,227 per dollar, the best performer overnight, while the Mexican peso edged 0.13% stronger to 17.39. The Chilean peso was virtually unchanged at 935.6. Argentina’s peso weakened 0.33% to 1,483 per dollar, continuing its managed depreciation path.

The dollar’s gentle firming this morning — the DXY index around 100.84 — will test these levels. For the real, the tension is between the pull of the carry trade and the drag of a stronger greenback. For the Mexican peso, everything hinges on the inflation data at midday.

Brazil’s consumer confidence figures at 11:00 BRT will offer a glimpse of how households are coping with the high Selic. The prior reading was 88.7; any improvement would support the narrative that the central bank can keep cutting, which is what the B3’s rally is pricing in.

05 The regional setup

The regional board tells a story of energy-fuelled outperformance in the Southern Cone. Argentina’s Merval continues to be the region’s momentum leader, closing in on its 52-week high as the energy complex and financial stocks benefit from high crude and a government that is keeping a tight fiscal rein.

Chile’s IPSA, up 0.50% to 11,009, is grinding steadily higher within 8% of its record. The index is supported by banks and retailers that are sensitive to local rate expectations. Colombia’s COLCAP remains the laggard, down 0.19% and stuck in a tight range below 2,320 as investors wait for clearer signals on trade and growth.

06 The technical picture

The Ibovespa at 177,548 is now 10.6% below its 52-week high of 198,657, having bounced hard from the lower end of a range that has held since early 2026. The +2.44% move on heavy turnover in Petrobras and Vale suggests institutional accumulation rather than a short-covering blip. The 180,000 level is the next resistance to watch.

The IPC in Mexico at 67,304 is 6% below its high of 71,601 and needs to hold above 67,000 to keep the uptrend intact. The peso’s stability around 17.4 per dollar is helping, but a hot CPI print could quickly change that equation. Argentina’s Merval is the most technically extended, trading within touching distance of the 3,390,505 high, and it is vulnerable to a pullback if retail sales data disappoints.

07 What to watch

• Mexico mid-month CPI and core inflation: The core rate is expected to ease to 3.95% year-on-year from 4.12%. A higher print would hit rate-cut expectations and could knock the peso and the IPC.
• Mexico June economic activity: Forecast at 1.1% year-on-year, down from 2.3%. A weak number would raise growth concerns and test the banking-heavy Mexbol.
• Brazil consumer confidence at 11:00 BRT: The prior reading was 88.7. An improvement would support the case for continued Selic cuts and keep the Ibovespa rally alive.
• Argentina retail sales and consumer confidence: Retail sales are expected to slow to 8% year-on-year from 12.6%. The Merval’s energy-fuelled rally needs domestic demand to hold up.

Frequently Asked Questions

Why did the Ibovespa surge while the S&P 500 was flat?

Heavy buying in commodity giants Petrobras and Vale, combined with aggressive bets on rate-sensitive consumer stocks like CVC, drove a domestic rotation that ignored the cautious US session.

What does the weak yen mean for Latin America?

A yen above 162 per dollar makes the carry trade very profitable — borrowing cheap in Japan and investing in Brazilian bonds yielding 14.25% is a powerful magnet for foreign capital.

Why is the Mexican peso so sensitive to today’s CPI data?

If core inflation comes in above the 3.95% estimate, Banxico will have less room to cut rates, reducing the peso’s yield appeal and potentially reversing recent gains.

What is driving Argentina’s Merval higher?

High crude prices above US$84 are boosting energy stocks, while the government’s fiscal discipline and a controlled peso depreciation are drawing foreign interest into Argentine equities.

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