Goldman Sachs Survey Flags 20% EWZ Upside on Potential Bolsonaro Victory in Brazil Runoff
Investor positioning data and option flows indicate markets are pricing a policy-rate driven re-rating conditional on a Bolsonaro win. Historical patterns tie Brazilian equity outperformance directly to rate cuts rather than commodity cycles. The runoff remains the decisive variable for near-term capital allocation.
The election outcome would extend a regional rightward shift already visible in Argentina and potentially Paraguay. Lula's base shows lower historical turnout, while Bolsonaro voters have demonstrated higher participation; this gap is unadjusted in most published polls. A victory would likely accelerate foreign equity inflows already visible in record EWZ call open interest.
Goldman Sachs: EWZ closes above 44.60 by December 31 if Bolsonaro wins the runoff.
Sources (2)
- [1]Goldman Sachs Client Note(https://www.goldmansachs.com/insights/pages/brazil-election-survey.html)
- [2]B3 Exchange Data on EWZ Options(https://www.b3.com.br/en_us/market-data-and-indices/)