Ideas
Scarce paper plus foreign inflows lift Brazil.
The Brazilian equity market can keep rallying because supply of paper has shrunk through buybacks, delistings and M&A while local investors are heavily underallocated in equities (R$14tn M4) and foreign inflows return on a weaker dollar, falling Selic, cheap valuations and a possible center-right election catalyst. Foreign inflows could be much larger than the R$25bn seen in January; if flows continue, locals may be forced to chase, potentially taking Ibovespa toward 300k and EWZ toward 60-70 in a benign scenario.
Assaí is scarce liquid food retail play.
After Carrefour delisted and Grupo Mateus has low free float due to 80% owner control, Assaí is the only truly liquid listed way to play Brazilian food retail. Foreign interest in the sector plus scarcity of listed alternatives could distort the stock upward.
SMIDs catch up as local funds return.
Small and mid caps have lagged the foreign-driven rally in Brazilian large caps because they depend on dedicated foreign investors and local equity funds, which have only started to capture money. As local funds return and domestic M4 money slowly increases risk exposure, Brazilian SMIDs have catch-up potential.
Dollar weakens versus real short term.
The dollar is unlikely to strengthen against the real in the short term because Trump will not change his confrontational and geopolitical stance and the resulting shift of global flows should continue to favor Brazil and emerging markets. However, he acknowledges the exchange rate may have limitations due to Brazil's external accounts.
NTN-B yields stay high without fiscal adjustment.
Brazilian real rates are unlikely to fall below 7% without a fiscal adjustment. The Tesouro keeps issuing NTN-B because it correlates with revenue, but 7.5% real for 10-15 years would make Brazil insolvent; without adjustment, NTN-B yields are unlikely to close significantly, limiting bond price upside.
Energy transition metals face strong demand.
The energy transition and AI/data-center electricity demand are increasing demand for uranium, copper and lithium, while supply cannot increase quickly. These metals should remain attractive on a supply-demand basis.
Brazilian banks can re-rate higher.
Historical valuation ranges for Brazilian banks are too rigid. Itaú is near 9-10x earnings and BTG near 10-11x, but with foreign flows dominating and Brazilian rates expected to fall, they can re-rate toward higher multiples seen in Chile, though Chile has lower rates. He will not stand in front of foreign flow.
Structural foreign flows favor emerging markets.
Foreign investors are reallocating out of US assets into emerging markets due to Trump policy uncertainty and distrust of US institutions. Record creations in EWZ and emerging-market ETFs show this is a structural flow trend, not just a two-week move, and Brazil captures a meaningful share of it.
Short euro on weak Europe growth.
He is short euro near 1.20 because mature economies outside the US are not growing well: Europe is stalling, Japan is sluggish, and India has political risk. Although Trump likes a weaker dollar to reindustrialize, the US wage gap versus China limits a large dollar decline, so euro upside is limited and the recent 10% DXY drop may pause or retrace.
Avoid gold at current high levels.
Gold at current levels is risky to own. He does not hold it because central banks have already bought heavily, gold may fall a little, and as it is high relative to commodities and emerging markets, some reserve managers may sell. It is not an attractive long at this price.
Silver outperforms gold on industrial demand.
He owns silver and expects it to outperform gold. Silver has new industrial demand from data centers and solar/electronics, supply is limited and it is usually a by-product of other metals, unlike gold whose above-ground reserves can be disgorged. This creates a tighter supply-demand setup.
Platinum benefits from scarcity and industrial demand.
There is a fundamentally supported call for platinum along with copper and silver because of supply scarcity and industrial demand; silver and platinum are not primary extraction but by-products, creating tight supply dynamics.
Underweight Brazilian electric utilities on tight spreads.
Brazilian electric utilities have become less attractive because their spreads to long NTN-B have compressed sharply; some now yield below double digits, close to long NTN-B, while growth is limited and election and fiscal risks remain. He has cut exposure to the sector and is weighing cash or NTN-B instead. Some idiosyncratic names like Eletrobras could differ if energy prices stay high, but the broad sector is not a favored allocation.
Lula win hurts Petrobras and Brazil.
If Lula wins the election, Brazilian assets should suffer, Petrobras should underperform more, the long nominal curve should steepen and NTN-B should also be affected. He assigns a 65-70% probability to Lula and sees a significant repricing of Brazilian assets in that scenario, though he says it is still early to trade the election.
This Market Makers video, published February 02, 2026,
features Christian Keleti, Alfredo Menezes
discussing BOVA11.SA, EWZ, ASAI3.SA, EWZS, USDBRL, NTN-B, COPPER, URA, LITHIUM, ITUB4.SA, BPAC11.SA, EEM, EUR, GLD, SILVER, PPLT, Brazilian electric utilities, PETR4.SA.
14 trade ideas extracted by AI with direction and confidence scoring.
Speakers:
Christian Keleti,
Alfredo Menezes
· Tickers:
BOVA11.SA,
EWZ,
ASAI3.SA,
EWZS,
USDBRL,
NTN-B,
COPPER,
URA,
LITHIUM,
ITUB4.SA,
BPAC11.SA,
EEM,
EUR,
GLD,
SILVER,
PPLT,
Brazilian electric utilities,
PETR4.SA
