Markets Do the Samba as Brazil Comes Under Attack

Brazil is no Turkey. That's the conclusion of investors who suddenly retreated from anything smacking of risk on Thursday as the meltdown in Brazil's financial markets intensified. While markets largely shrugged off some of the pain in recent weeks experienced by the likes of Turkey and Argentina, Brazil and its $1.8 trillion economy are too big to ignore.

Brazil's benchmark Ibovespa stock index fell as much as 6.51 percent, its currency weakened as much as 3 percent and the nation’s five-year bond yields topped 11.5 percent as concerns over the potential election of an anti-reformist presidential candidate and the fallout from a 10-day truckers’ strike rattled investors. Many credited the jaw-dropping moves with pulling down U.S. stocks and sparking a rally in haven assets such as Treasuries.