2014.10.2103:09:34UTC+00Brazilian stocks plummet on voter polls, real slumps

Brazilian stocks plummeted, leading global declines, with the Ibovespa dropping on news that President Dilma Rousseff will be tied up with Senator Aecio Neves in the upcoming presidential elections this weekend according to voter polls. The real weakened significantly as well.

The Ibovespa shed 2.6% to 54,302.57 by the end of trading in Sao Paulo. Despite the steep fall, the gauge still retained a hefty 21% of its advance from the year low on earlier bets of a reformed government after the elections. The nation is still having a hard time recovering from its 2009 recession that’s why hopes of an ousted Dilma Rousseff in the elections will reduce intervention in state-run companies. The nation’s currency weakened by 1.2% to match the dollar at 2.4643 real per dollar.

Petroleo Brasileiro or Petrobras shed 6.2%, the lowest of the shares since October 2.

Partner at Orama Asset Management, Alvaro Bandeira commented to Bloomberg that every time the poll displays a reduced chance of reform in the government, the investors get nervous and adjust their positions accordingly.