The Ibovespa fell 1.6% to close at 141,356 on Tuesday as renewed fiscal risk together with a string of company shocks forced investors to sharply reprice Brazil’s risk premium. Finance Minister Fernando Haddad’s confirmation that the government is studying zero urban fares rekindled fears of large unbudgeted spending and pushed risk premiums higher. At the same time acute corporate news intensified selling with MRV plunging 12.4% after a weak third quarter preview and cash generation shortfalls, while rate sensitive Localiza, Lojas Renner and Natura fell between 3.9% and 6.3% as consumer discretionary demand and financing costs came under strain. Foreign investors moved to reweight portfolios in response to the worsening fiscal picture and corporate risks, and the US government shutdown deprived markets of fresh macro data on Fed timing, increasing volatility and further reducing appetite for locally exposed names.