Vale Shares Fall 3.23% to $12 After Lula’s Re-election and UBS Cuts Price Target
Key Facts
Vale shares listed in New York closed at $12.00 on October 26, 2026, down 3.23% during the session, according to data cited by The Motley Fool. The decline came after the re-election of Brazilian President Luiz Inácio Lula da Silva, alongside UBS’s price-target cut for the stock late in the previous week. The Motley Fool said investors are also watching the company’s third-quarter results, scheduled for release on October 29. The election victory reshaped investor bets on the direction of policy in Brazil, as markets had moved ahead of the runoff on the prospect of a change in government. Brazilian assets broadly fell, while Vale’s decline was smaller than drops recorded by some domestic market indexes.
Lula was re-elected on Sunday after defeating right-wing senator Flávio Bolsonaro. Brazil’s electoral court declared him the winner with 51.8% of the vote, ahead by about 4.4 million votes, according to the Associated Press. Ahead of the runoff, Brazilian stocks closed on Friday about 7% above their level before the first round, and the real was about 5% stronger against the dollar, according to Reuters. Those moves showed the scale of the earlier bet on a rightward political shift. After the result was announced, the real fell more than 11% against the dollar in early spot trading, and the Bovespa index dropped more than 15%, according to Reuters. The report described the currency’s fall as one of its largest daily losses on record and said the index’s decline was its biggest since 1998.
Losses spread to other instruments linked to the Brazilian market: November real futures fell 10% in Asian trading, while the Tokyo-listed Nomura NF Ibovespa Link fund dropped 15%, according to Reuters. B3 halted trading for 30 minutes after the Ibovespa fell 10% from its previous close, triggering a circuit breaker. The Treasury also canceled bond auctions scheduled for October 27 and 29, one for inflation-linked bonds and the other for fixed-rate bonds. These steps reflect the spread of the turmoil from stocks to the foreign-exchange market and government debt issuance. In this context, Vale shares fell in New York, but session data put the decline at 3.23%, below the Brazilian index’s drop of more than 15% in early trading.
At the company level, UBS cut its price target for Vale from $15.00 to $14.50 per share while keeping its rating Neutral, late in the previous week, according to The Motley Fool. The adjustment came alongside the effect of the election result on the stock, as investors awaited the earnings release. Available information does not link the target cut to a change in UBS’s rating; the rating remained Neutral. On Brazil’s fiscal position, Alejo Czerwonko of UBS said investors want “a clear and credible commitment to fiscal discipline.” He added that sentiment may remain weak until a fiscal plan becomes clear. Lula’s team aims to achieve a primary budget surplus equivalent to about 1.3% of gross domestic product by 2030, while public debt exceeds 82% of GDP, according to Reuters.
Investors are now focused on Lula’s choice of finance minister and what the appointment may reveal about the next administration’s fiscal approach. Graham Stock of RBC BlueBay said the key signal for markets will be the new administration’s commitment to fiscal discipline, starting with the appointment of a finance minister in the coming weeks. As for Vale, the company said its third-quarter results will be released after the market close on October 29, 2026. An investor webcast is scheduled for the following day, October 30, at 10:00 a.m. New York time. Investors thus have a near-term date to assess the company’s performance while also tracking signals on Brazil’s fiscal policy.