Brazilian equities fell on Monday as higher inflation expectations, an unfavorable external backdrop and new polling showing President Luiz Inacio Lula da Silva ahead of Senator Flavio Bolsonaro weighed on sentiment. The Ibovespa declined 0.3% to close at 182,991. Quaest put Lula at 39% and Bolsonaro at 34%, while Futura/100% Cidades showed a much tighter race at 38.3% and 37.7%, respectively, with six days remaining before the Oct. 4 first-round vote. Under Brazilian law, the top two candidates advance to an Oct. 25 runoff if no candidate wins more than 50% of valid votes. Oil prices resumed gains after US President Donald Trump rejected Iran’s proposal to reopen the Strait of Hormuz, raising concerns that energy-driven inflation could keep interest rates elevated. The BCB’s Focus survey increased its 2026 inflation forecast to 4.99% from 4.92%, maintained the year-end Selic forecast at 13.5% and cut its 2026 GDP growth projection to 1.86% from 1.88%. The 10-year government bond yield had risen to around 14.25% in late September. Itaú and Bradesco each fell 1%, while Petrobras gained 1.5% and Vale rose 0.5%. Flavio Bolsonaro, a 45-year-old senator and lawyer selected by former President Jair Bolsonaro, has faced scrutiny over an alleged corruption and money-laundering investigation linked to a partly banker-funded biographical film about his father. Jair Bolsonaro is serving a 27-year prison sentence for plotting a coup d’état after losing narrowly to Lula in 2022. The election has wider geopolitical and economic significance for Brazil, a major agricultural and natural-resources power, amid a conservative shift in several Latin American countries.