🛍️ Buyer's remorse

At the start of the year, many investors were bullish on the retail sector. XP, the country's leading brokerage firm, held a "constructive" view of Brazilian consumption, resting on an expected rate-cut cycle starting in March, an income-tax exemption topping up household budgets and tame food inflation. 

Danniela Eiger, XP's head analyst for retail, has five picks — Smart Fit, Raia Drogasil, Mercado Livre, Vivara and Lojas Renner, with Natura as a riskier add-on — amounting to a wager that cheaper credit would send Brazilians back to the checkout. Only Renner has held its value in a dreadful 2026 for retailers at B3, the São Paulo stock exchange.

The B3 consumption index has slipped from roughly 3,000 points at the start of the year to about 2,800 in June, down some 8% in 2026. Widen the lens and the damage runs years deep…

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