Brazil’s presidential election will be decided in a runoff on October 25 after no candidate won a majority in the October 4 first round. Right-wing senator Flavio Bolsonaro took 47 per cent of the vote, ahead of President Luiz Inacio Lula da Silva’s 45 per cent.

The result stunned pollsters, who had forecast Lula would lead the first round by around three points. Bolsonaro is the son of former President Jair Bolsonaro, who is serving a 27-year sentence for plotting a coup after losing the 2022 election.

Twelve candidates contested the first round, with the campaign dominated by the cost of living, corruption and crime. Lula has promised to focus on the 30 million voters who stayed home, saying more than enough votes are available to close the gap.

Markets expect a rally under Bolsonaro, who has pitched himself as a pro-market candidate with plans for tighter public spending, privatisations and lower taxes. The MSCI Brazil ETF jumped more than 14 per cent in overseas trading after the first-round result.