Brazil's stock market is emerging as an early winner in 2022, with its performance trouncing most other major indexes so far.
Why it matters: The rally in the Ibovespa underscores how commodity producers can benefit in an inflationary environment.
- Brazil is a major producer of raw materials like iron ore, soybeans and petroleum, and its markets are dominated by companies like energy giant Petrobras, and Vale, a massive iron miner.
Yes, but: The markets are not the economy. What's good for commodity companies — higher prices — can hurt elsewhere.
- Surging consumer prices have prompted Brazil's central bank to repeatedly raise interest rates, and that's helped push the country into a recession.
Go deeper: Short sellers take aim at consumer stocks