Petrobras stock plunges 21.7% as Lula wins Brazil's presidential election

Petrobras stock plunged 21.7% in premarket trading to $20.49 after President Luiz Inácio Lula da Silva won a historic fourth term in Brazil’s presidential runoff, defeating Senator Flávio Bolsonaro by roughly 51.8% to 48.2%, a result that caught markets off guard. The rout extended beyond Petrobras, with banking stocks like Itaú Unibanco, Banco Bradesco, and Nu falling 23% to 29%, and the iShares MSCI Brazil ETF dropping nearly 20%. Markets had rallied on Bolsonaro’s first-round lead, pricing in fiscal discipline, but Lula’s focus on consumption-driven growth spooked investors. Lula now faces the challenge of slowing Brazil’s debt growth while preserving social programs, with uncertainty heightened by Bolsonaro’s refusal to concede. Petrobras’ production report is due October 28, with full Q3 earnings on November 10.