Stock Futures, Treasurys Steady as Brazilian Assets Slide

By Joe Stonor

U.S. stock futures and Treasurys were largely steady Monday as Brazilian assets sold off sharply following the surprise election victory of leftist incumbent Luiz Inacio Lula da Silva.

Futures for the Dow Jones Industrial Average and the S&P 500 rose by 0.5% and 0.3%, respectively. Yields on 10-year and 30-year Treasurys were little moved, with 10-year yields holding below 5%.

Investor attention turned to sharp falls in Brazil-linked assets following President Lula's unexpected second-round victory over Flavio Bolsonaro. Front-month Brazilian real futures contracts weakened more than 10% against the dollar while a basket of Brazilian stocks tumbled over 27% in premarket trade. In Europe, companies with significant activities in Brazil dropped sharply, with Spanish bank Santander down over 5%.

"Instead of fiscal consolidation under Bolsonaro, Brazilian assets are instead going to have to contend with Lula's campaign pledges, including a shorter working week," said ING economist Chris Turner.

Nasdaq futures slipped 0.2% amid continued weakness in cloud-computing stocks. In an X post Sunday, SpaceX owner Elon Musk said lenders were turning away from cloud-computing companies, and that company consolidation in the sector is inevitable. CoreWeave shares fell 2.55% premarket, extending a recent rout. Earnings reports from hyperscalers this week will help shape the AI narrative. Alphabet and Microsoft report earnings Wednesday, before Amazon and Intel on Thursday.

Asian indexes were mixed Monday, as investors responded to Friday's surge in oil prices and AI names remained under pressure. China's Shanghai Composite Index recovered early losses to close 0.2% higher, though tech heavy indexes in South Korea and Japan both fell back. European stocks broadly gained, with the continent-wide Stoxx 600 rising 0.4%.

Oil prices remained elevated despite pulling back in early trade Monday. Brent crude contracts for December delivery fell 2% to $114.40 a barrel, while West Texas Intermediate December contracts fell 2.5% but held above $100 a barrel. President Trump told Fox News on Sunday that it is nearing decision time on whether he will make a deal with Tehran or "finish it off."

The dollar was flat against a basket of global currencies, while bitcoin slipped 0.3% to hover above $80,000. Gold futures held above $4,000 a troy ounce.

For the day ahead, data prints include the Dallas Fed's manufacturing activity report for October, and the Chicago Fed's national activity index for September. Verizon and Welltower are among companies reporting earnings.

Write to Joe Stonor at josephmichael.stonor@wsj.com

(END) Dow Jones Newswires

October 26, 2026 05:35 ET (09:35 GMT)