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Flávio Bolsonaro's 47.0% 1st-round result caught the markets off guard. EWZ jumped into the low teens % premarket. To understand why, bear in mind that Brazil's gross public debt has climbed to around 83% of GDP from roughly 71% when Lula (the current president) took office. I think the 13.75% Selic rate keeps Brazil's equity risk premium tightly linked to confidence in fiscal policy.

iShares MSCI Brazil ETF surges 13% on pro-market election momentum, outperforming the S&P 500 over the past year. EWZ's valuation remains compelling at 8.7x P/E with a sub-1.0x PEG, supported by strong technicals and bullish election-driven sentiment. Financials and Energy dominate EWZ's portfolio, positioning it to benefit from sector-specific tailwinds and potential pro-shareholder reforms.

Flávio Bolsonaro took a surprise lead over Luiz Inácio Lula da Silva in the first round of Brazil's presidential election, making him the favorite to win the runoff which is to be held October 25. Brazil's real surged against the dollar in Sao Paulo Monday morning.

Flávio Bolsonaro and Luiz Inácio Lula da Silva will face off in a run-off on Oct. 25 for Brazil's presidency, after both received the most but neither a majority of the votes in a first round result on Sunday. Bolsonaro is now seen as the overwhelming favorite to win the presidency, following a better-than-expected performance for him in the first round compared to what polls expected before the result.

An election shock sent Brazil's biggest ETF surging, and one billionaire investor had a massive stake sitting quietly on the books since June. Whether that position survived the months between then and today is the question nobody can answer yet.