Coffee with the Market — October 17, 2026

Good morning, everyone. Today's menu is hot: Brazilian elections shaking everything up, AI asking for trillions, Petrobras hitting a record, and Japan pouring money into chips. Let's get to what matters.

1. The Election Rally Has Fuel — and Goldman Knows It

The fact: The Ibovespa has already risen 8% since the first round, and Goldman Sachs projects it could reach 225,000 points if the next government delivers fiscal discipline.

My verdict: I Would Buy — but sparingly and with a mental stop loss. The market is pricing in an ideal scenario, which is dangerous, but the asymmetry still favors those who are positioned.

Assets to watch:

• EWZ (Brazil ETF in NY) — direct and liquid exposure
• IBOV futures — for those trading the index
• B3SA3 — the exchange gains from volume, regardless of who's rising
• Major banks (ITUB4, BBDC4) — main beneficiaries of a pro-market scenario

2. Petrobras: 100% Gain and R$ 800 Billion — Time to Take Profits?

The fact: PETR4 rose about 100% in 2026 and PETR3 around 110%, pushing the state-owned company's market value to a record R$ 800 billion.

My verdict: I Would Reduce — partially. Not because the company is bad, but because doubling in value in one year calls for caution. When everyone is euphoric, it's time to take chips off the table. Selling half and letting the rest run is a sound strategy.

Assets to watch:

• PETR4 / PETR3 — obvious
• XOM (Exxon) — international valuation comparison
• PBR (Petrobras ADR in NY) — same exposure, different currency
• Oil and gas sector as a whole — may suffer a joint correction

3. Japan Puts US$ 21 Billion into Chips in the US — Strong Geopolitical Signal

The fact: Japan will invest up to US$ 21 billion to build two semiconductor factories in New York, as part of a trade agreement with the Trump administration.

My verdict: I Would Buy — the semiconductor sector remains the backbone of the digital economy, and public money flowing in only reinforces the long-term thesis.

Assets to watch:

• TSM (Taiwan Semiconductor) — the world's largest manufacturer
• NVDA — consumes chips on an industrial scale
• ASML — lithography equipment supplier
• SOXX (semiconductor ETF) — diversified exposure

4. AI Needs US$ 6 Trillion and Nobody Knows Where It'll Come From

The fact: A Bain report points out that the AI economy requires around US$ 6 trillion in funding, but the origin of that capital is still unknown.

My verdict: I Would Hold — I'm positioned in AI, but I'm not adding now. The bubble risk is real when the numbers don't add up. I'd rather hold and watch. If the funding doesn't materialize, a sharp correction is coming.

Assets to watch:

• MSFT — biggest corporate bettor on AI
• GOOGL — infrastructure + quantum research
• AMZN — AWS as AI backbone
• BOTZ (robotics and AI ETF) — thematic exposure

5. Google Breaks Quantum Barrier — Willow Cuts Errors by 40x

The fact: Google's quantum AI team managed to enable "magic state cultivation" on the Willow processor, reducing errors by 40 times and publishing in Science.

My verdict: I Would Buy — GOOGL specifically. Quantum computing is the next leap and Google is ahead. This isn't a short-term trade, it's a 5-to-10-year position.

Assets to watch:

• GOOGL — owner of the technology
• IBM — direct quantum competitor
• IONQ — pure play in quantum computing
• Cybersecurity sector — quantum threatens current encryption

6. Brazil Approves End of 6x1 Schedule — Real Impact on the Economy

The fact: The Senate approved reducing the workweek from 44 to 40 hours without pay cuts, ending the 6x1 schedule.

My verdict: I Would Reduce — exposure to labor-intensive sectors (retail, services, construction). Labor costs rise, margins compress. It's not a catastrophe, but the pass-through is inevitable.

Assets to watch:

• MGLU3 (Magazine Luiza) — retail with many physical stores
• LREN3 (Lojas Renner) — same
• CYRE3 (Cyrela) — labor-intensive construction
• Services sector in general — bars, restaurants, logistics

Immediate Opportunities

• EWZ and Brazilian banks — election rally still has gas if the fiscal scenario doesn't derail
• Semiconductors (TSM, SOXX) — public money flowing in, growing structural demand
• GOOGL — quantum breakthrough puts the company in another league