Gavekal Research analyst Rohan Daswani said Lula’s unexpected victory over Bolsonaro could trigger heavy selling when Brazil’s market opens, but investors should treat any dip as a buying opportunity. Markets had earlier priced in a Bolsonaro win and expectations of stronger fiscal discipline; as those trades unwind, Daswani said Brazil’s structural case remains intact: nominal and real rates are unusually high, the economy has large commodity exposure, and Brazil’s role in key mineral supply ch

Gavekal Research analyst Rohan Daswani said Lula’s unexpected victory over Bolsonaro could trigger heavy selling when Brazil’s market opens, but investors should treat any dip as a buying opportunity. Markets had earlier priced in a Bolsonaro win and expectations of stronger fiscal discipline; as those trades unwind, Daswani said Brazil’s structural case remains intact: nominal and real rates are unusually high, the economy has large commodity exposure, and Brazil’s role in key mineral supply chains is rising. He noted Brazil’s Congress is markedly more conservative than the president, limiting scope for a sharp leftward policy shift. (Brazilian equities open 21:00 Beijing time.)