The Brazilian election shows stronger-than-expected support for Bolsonaro

BRAZIL

BRAZIL LEADING TO NO OUTRIGHT

WINNER

OUR SEEMA MODY HAS DETAILS ON

WHY BRAZILIAN STOCKS HIGHER

TODAY.

» A POSITIVE REACTION TO

PRESIDENT JAIR BOLSONARO'S

STRONGER THAN EXPECTED SHOWING

HE PROMISES TO CURB ENERGY

PRICES WHILE CALLING INTO

QUESTION THE COUNTRY'S

ELECTORATE SYSTEM, EVEN IF

OPPOSITION CANDIDATE LULA

DESILVA WINS, HE SAYS HE WILL

HAVE TO GOVERN MANY TOWARDS THE

CENTER GIVEN THE NUMBER OF RIGHT

WING LEADERS IN THE SENATE

THAT'S ALSO PRFOVIDING A LITTLE

BIT OF RELIEF FOR INVESTORS.

THE RIAL IS UP ABOUT 4.6%

AGAINST THE DOLLAR, IT.

THE RALLY HAS BEEN MORE TIED TO

THE REBOUND IN OIL AND ENERGY

PRICES THAN POLITICS, BUT UBS

AND CAPITAL ECONOMICS, THEY

ARGUE THAT WHO EVER LEADS THIS

COUNTRY THROUGH A PENDING GLOBAL

RECESSION, THAT COULD REALLY

INFORM INVESTORS ON WHETHER THIS

REMAINS A GOOD TRADE, CARL

» SEEMA, YOU KNOW, CENTRAL

BANKS AROUND THE WORLD ARE SORT

OF IN DIFFERING CHAPTERS OF

FIGHTING INFLATION, AND THERE

ARE SOME WHO HAVE ARGUED MAYBE

BRAZIL GOT AN EARLIER START AND

CAN END SOONER TOO

HOW IMPORTANT IS THAT?

» THAT'S ONE OF THE REASONS

BRAZILIAN STOCKS HAVE

OUTPERFORMED IS BECAUSE ITS

CENTRAL BANK STARTED TO RAISE

RATES LATE LAST YEAR, VERY MUCH

BEFORE THE FED AND THE ECB AND

OTHER CENTRAL BANKS AROUND THE

WORLD, AND WHILE INFLATION IS

STILL AROUND 8 TO 9% IN BRAZIL,

IT HAS BEEN COMING DOWN STEADILY

OVER THE PAST FEW MONTHS

THAT CERTAINLY HELPED BOLSONARO

AS WELL WHO CURRENTLY IS THE

PR