Brazilian markets just took a serious hit—we're talking the steepest dive since 2021. What's driving this selloff? Political jitters are back in full force as Bolsonaro's son officially throws his hat in the ring for the upcoming race.

The timing couldn't be more interesting. Investors are clearly spooked by what this means for policy direction and economic stability down the road. When political uncertainty cranks up like this, capital tends to get nervous fast. We've seen this pattern before in emerging markets—the mere whiff of a controversial candidacy can trigger portfolio reshuffling on a massive scale.

What's worth watching now? How institutional money responds over the next few weeks. If foreign investors start pulling back significantly, we could see spillover effects across Latin American assets. Political risk premiums are definitely getting repriced right now, and volatility is likely here to stay until we get more clarity on the electoral landscape.