Latin American markets prepare for cautious Monday gains

Latin American stock markets are expected to open mostly higher on Monday, supported by Wall Street’s positive close and improving hopes for a reduction in Middle East hostilities. The opening may nevertheless be uneven, as falling oil prices would benefit some regional economies while weakening an important source of earnings for Brazil and Colombia.

Brazil carries positive momentum
Brazil’s Ibovespa rose 0.47% on Friday to close at 177,999, its highest level in approximately one month. The index gained 3.68% during July and stood more than 34% above its level a year earlier.

Financial, industrial and basic-materials companies led Friday’s advance. Santander Brasil was among the most prominent individual performers after its Spanish parent offered to acquire the remaining shares it does not already own.

The positive finish creates favourable conditions for Monday, although Brazil’s high borrowing costs and continuing fiscal concerns may prevent a broad rally. Almost half of the country’s public debt is now linked to the Selic interest rate, increasing the government’s exposure to elevated financing costs.

Mexico may recover from Friday’s decline
Mexico’s S&P/BMV IPC fell 0.53% on Friday to 66,937. However, the wider economic picture has recently improved. Mexico’s economy expanded by 1.5% during the second quarter compared with the previous three months and grew by 2.2% from a year earlier.

Those figures could support construction, banking and consumer shares when trading begins. The close economic relationship with the United States also means Mexico may benefit from Friday’s gains on Wall Street.

The Mexican peso and local exporters will remain sensitive to movements in the US dollar, American bond yields and expectations surrounding Federal Reserve policy.

Oil divides the region
Possible progress towards an agreement with Iran could reduce the geopolitical premium in crude prices. Lower oil would help contain transport and inflation costs in Chile, Peru and several Central American economies.

The effect may be less positive for Brazilian and Colombian energy companies. Colombia’s COLCAP gained 2.13% on Friday to reach 2,392, while Argentina’s Merval declined 0.45% to approximately 3.29 million points.

Investors may consequently rotate towards banks, retailers, airlines and other businesses that benefit from lower fuel costs, while taking profits in oil producers.

Monday’s economic signals
Brazil and Mexico will publish July manufacturing surveys on Monday. Brazil’s previous manufacturing PMI stood at 50.8, indicating modest expansion, while Mexico’s corresponding survey reached 51.3.

The new figures will help determine whether domestic industry is strong enough to offset high interest rates, uncertain international demand and geopolitical disruption. Brazil’s central-bank outlook and Mexico’s approaching policy decision will also influence regional currencies.

The most likely Monday opening is therefore cautiously positive in São Paulo, with a possible recovery in Mexico City and selective gains in Chile and Peru. Bogotá may open firmer but could lose momentum if crude prices fall sharply, while Buenos Aires is expected to remain primarily driven by domestic political and currency conditions.

Newshub Editorial in Latin America – 2 August 2026