Brazil: Ibovespa Retreats on Banking and Mining Losses.

The Ibovespa fell 0.7% to close at 204,302 on Wednesday but remained 9.6% higher on the week as markets gauged the outlook for earnings and interest rates should presidential candidate Flavio Bolsonaro win this month’s runoff. Bolsonaro finished ahead of incumbent President Lula in the first round, pushing the index to a record high. Banks and financial services companies led those gains as the resulting rally in bonds and credit improved the sector’s outlook. On Wednesday, the financial sector pulled back amid elevated global bond yields and hawkish FOMC minutes. Itau fell 2.7%, Bradesco lost 3.7% and Itausa shed 3.3%. Vale fell 2.3% ahead of the reopening of Chinese iron ore markets on Thursday following the National Day holiday. CSN Mineracao (-1.2%) and steelmakers also posted losses. Other laggards included Ambev (-1.7%) and Embraer (-5.1%).