Brazil Heads for Presidential Runoff

It looks like opinion polls going into this perhaps underestimated the amount

of base support for both scenarios. Yes that's right.

It was kind of a surprising outcome because both L.A.

had secured a much tighter gap to front four on their Lula.

That is likely to be well received by markets when low cost reopen on Monday

because it chose that both scenario has a chance of winning in the second round.

All do. Polls have all showed Lula had the

outcome of today's vote shows that we can't have a surprise again.

Also the fact that the Lula got a much narrower lead over both Bozo latter may

suggest that he can lean a bit toward the center over the coming three weeks

until we have the DAX vote. Right now let's I mean you touched on it

already but generally speaking with this uncertainty how do you think local

markets are expected to sort of meander these next few days.

Yeah I think much will depend on the theory that it can they will adopt going

forward both of them. Neither of them actually have given much

detail on the economic plans. We don't know who the finance minister

will be for Lula for example. So I think it will depend a lot on what

they say about their plans for the fiscal accounts and for privatizations

social spending. Let's find that this is a very important

election for the economy going forward because the next president will have to

balance growing demand for social spending and at the same time convince

investors that they will be fiscally responsible.

Between now and October 30th what's going to be key.

What should investors be watching for. Yeah I think the main thing to watch

here is if Lula will give any signal on who will be his finance minister and

from both and outside whether he will increase his rhetoric or if he will try

to gain the votes of these more center candidates that got the minority votes.

Also Lula is as I said is expected to maybe lean more toward the center.

So any economic policies plans that they mention will be very important for

trade. Those.