Brazilian Stock Exchange Halts Trading as Ibovespa Drops 10% After Lula's Re-election

Brazil's B3 stock exchange activated its circuit breaker on Monday, October 26, after the Ibovespa index fell 10% from the previous close, suspending trading for 30 minutes. The sharp decline followed the re-election of Luiz Inácio Lula da Silva, which sparked market concerns over fiscal policy. The trading halt affected stocks, BDRs, ETFs, options, and private fixed-income securities. Under B3 rules, a 10% drop triggers a 30-minute pause, a 15% drop extends it to one hour, and a 20% drop could suspend trading indefinitely. The mechanism is not activated in the final 30 minutes of the session. This marks the 24th time the circuit breaker has been triggered in B3's history. Previous activations occurred during the 1997 Asian crisis, the 1998 Russian crisis, the 1999 Brazilian currency crisis, the 2008 financial crisis, the 2017 JBS scandal, and six times in March 2020 amid early pandemic volatility.