UBS Brazil Chief Says Global Chaos Now Favours Brazilian Markets
Key Facts
—The framing: Daniel Bassan, CEO of UBS Brazil and head of UBS Latin America, told O Globo that global instability has placed Brazil “at the centre of the map” for international investors and that the country is benefiting from a structural re-rating of emerging markets.
—The flow: Foreign capital inflows to Brazil’s B3 stock exchange totalled R$26.3 billion ($4.8 billion) in January 2026, the largest monthly inflow since 2022 and more than the entire 2025 total.
—The reversal: Since the January 2026 peak, foreign capital entering B3 has fallen by approximately 88%. Bassan said the inflow could exit “in a jump” if fiscal credibility fails.
—The rate pressure: The Selic at 14.5% “removes room for manoeuvre from entrepreneurs,” Bassan said. UBS sees the rate ending the year at 11.5%, more optimistic than the consensus 12.25%.
—The political read: Foreign investors “are not concerned about whether it is an election year or which candidate wins. What they want is long-term action. We need a project of country, not of a government.”
The Swiss bank running the largest foreign brokerage on the São Paulo exchange has put a name on what order flow has been showing for six months. Brazil is no longer a peripheral allocation. Whether the inflow becomes structural or merely tactical depends on the next six weeks of fiscal signalling.
What Bassan actually said
Daniel Bassan, CEO of UBS Brazil and head of UBS Latin America since June 2024, framed investor positioning toward Brazil in his Sunday O Globo interview as more constructive than at any point in his eight years at the Swiss bank. The Rio Times, the Latin American financial news outlet, reports that the core argument is structural: a combination of US-China tariff escalation, the Iran war, and dollar depreciation has triggered a global capital reallocation toward emerging markets. Brazil is one of the principal destinations.
The numbers anchor the case. Foreign capital invested R$26.3 billion ($4.8 billion) in Brazilian equities in January 2026, the largest monthly inflow since 2022 and a figure exceeding the entire 2025 annual flow. The UBS brokerage, which handles roughly 17% of B3’s traded volume, registered the shift directly. The Ibovespa is up about 13% year-to-date, with foreign capital accounting for more than half of the price action.
The 88% reversal warning
The counter-signal is equally direct. Since the January record, monthly foreign inflows have fallen by approximately 88%. “For this money to leave the stock market, it is one jump,” Bassan told CNN Brasil during the Brazil Week event in New York earlier this month. His specific concern is the fiscal trajectory: “A country with high debt does not function. Foreign investors want us to start making adjustments.” Brazil’s gross debt sits at approximately 92% of GDP, a level the market has priced in but which leaves limited room for additional discretionary spending.
UBS’s read at a glance
| Indicator | Reading |
|---|---|
| January 2026 foreign inflow | R$26.3 billion ($4.8 billion) |
| All of 2025 foreign inflow | R$25.5 billion (full year) |
| Drop from January peak | ~88% |
| Ibovespa YTD 2026 | ~+13% |
| UBS brokerage share of B3 volume | ~17% |
| UBS Selic year-end forecast | 11.5% (vs 12.25% consensus) |
| B3 2026 ADTV projection (UBS) | R$31.8 billion (+25% YoY) |
The sectors UBS is positioning behind
Bassan named five sectors as structural beneficiaries: electricity generation, sanitation, insurance, technology, and data centres. Two theses sit behind the combination. The regulated-utility argument: Brazilian electricity and water concessions offer long-duration inflation-linked cash flows in a country whose policy frameworks have survived four political cycles. The AI-infrastructure argument: Brazil’s renewable grid gives hyperscalers a green-credentials advantage, and Equinix, Scala and others are expanding in São Paulo on that basis.
UBS BB research raised Petrobras’s price target from R$40 to R$60 on the assumption that the company will adjust fuel prices in Q2. UBS BB upgraded B3 itself to buy in February. A UBS study earlier this year mapped R$3.2 billion of rare-earth projects in Brazil as the structural lever in the US-China supply-chain dispute.
What investors and analysts watch
- Selic path. UBS at 11.5% year-end vs 12.25% consensus is the cleanest differentiator. The May Copom decision will mark which trajectory dominates.
- Fiscal framework signal. Bassan’s “project of country” framing identifies the test: whether the Lula administration credibly commits to debt stabilisation before October.
- IPO window. Bassan signalled UBS expects at least one billion-real IPO in the second half of 2026, contingent on liquidity sufficient to give foreign investors an exit door.
- Election-year volatility. The October vote remains the binary risk event. UBS sees post-election re-rating potential regardless of which candidate prevails, if fiscal commitments hold.
Connected Coverage
The Datafolha priority-area poll sits in our Datafolha readout. Lula’s WaPo positioning is in our WaPo interview analysis. The TCU’s parliamentary-amendment finding is in our TCU audit readout. Brazil’s morning market signal is in our morning briefing.
Reported by The Rio Times — Latin American financial news. Filed May 18, 2026.
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