Shares of MGLU3, VAMO3, and AZZA3 fell more than 10% again on Wednesday (10/28)—just two days after the post-reelection market collapse. The reason remains the same: long-term future interest rates climbed once more, prompting the market to trim positions in companies that depend on cheap credit to grow.
Why is MGLU3 stock falling today?
A second wave of surging long-term interest rates. On Wednesday, the January 2031 DI future reached 15.03%—up 0.12 percentage points from Tuesday. Stocks tied to credit and domestic consumption react immediately to this shift: the higher the long-term rate, the lower the present value of the earnings these companies are set to generate in the coming years. MGLU3 dropped 12% to R$ 5.05. VAMO3 shares fell 12.71% to R$ 2.54, and AZZA3 declined 10.60% to R$ 14.84.
The past 26 days: From R$ 7.61 to R$ 13.93, and back to R$ 5.05
The election calendar explains everything that happened to MGLU3 in October. On October 2, the eve of the first round of voting, the stock traded at R$ 7.61. With polls showing Bolsonaro ahead heading into the runoff, domestic and credit-sensitive companies were bought up as bets on a political reversal—and a call from Citi, which raised its price target from R$ 6 to R$ 14, accelerated the move. On October 9, the stock jumped nearly 18% in a single session to hit R$ 12.05.
The rally pushed the stock to R$ 13.93 on October 21—an 83% gain in 19 days. The runoff undid all of it: what dragged MGLU3 down by 58.23% on the Monday following the reelection is detailed here—with the stock closing at R$ 5.30. Tuesday (10/27) brought partial relief thanks to National Treasury intervention in the bond market. Wednesday closed out the cycle: future rates resumed their pressure, and the stock gave up another 12%.
Who else fell during the same session
The sell-off was not limited to these three stocks. The Ibovespa traded below 171,000 points, dropping about 3% for the session—a loss of more than 5,000 points compared to the previous close. The pattern among the biggest decliners is clear: homebuilders, retailers, and fleet rental companies dominate the top of the negative list. These are businesses that require cheap credit to grow or depend on household consumption—both of which become more expensive when long-term DI rates rise.
Why is VAMO3 falling as hard as Magalu?
Magalu is a retailer, so it makes intuitive sense for it to suffer in a high-rate environment. Vamos, which is less obvious to those who do not follow it closely, is a truck and agricultural equipment rental company operating with R$ 11.56 billion in net debt, equivalent to 3 times EBITDA. Heavy fleet leasing is a capital-intensive business: the company finances asset purchases and leases them to clients. Each debt rollover becomes more expensive when DI rates climb—and DI rates climbed.
CEO Gustavo Couto had already pointed to high interest rates as the main drag on earnings: in the first quarter of 2026, the company's net income fell 19.7% compared to the same period a year earlier. On Monday, VAMO3's historic drop following the election outcome had already repriced the stock for a scenario of higher rates for longer. Wednesday's session reinforced that position.
AZZA3 shares (Azzas 2154, which includes Arezzo, Schutz, and Reserva) fall into the same domestic consumption bucket. As a premium fashion retailer, it grows when credit is easy and struggles when household borrowing costs rise. CADE's approval of Azzas' corporate split remains on the horizon, but the spinoff does not alter the rate-sensitive profile of either business: a consumer financing an R$ 800 pair of sneakers feels the same squeeze when DI rates rise.
During Wednesday's session, the January 2028 DI closed at 14.505% and the January 2029 contract reached 14.905%. No major maturity closed below 13.5%—representing a permanent opportunity cost. Investors holding MGLU3, VAMO3, or AZZA3 are giving up a government bond paying 15% with no credit risk. Until that risk premium compensates, the selling pressure will persist.
What this means for investors holding these stocks
This drop did not stem from weak earnings or a specific material fact at any of these companies—it is a macroeconomic repricing. That carries a different weight: there is no quarterly balance sheet or corporate filing that can reverse this movement today. A turnaround depends on the market believing the next administration will preserve the fiscal anchor—and that will only become clear once the cabinet is announced. As long as long-term DI rates remain above 14.5%, the discount on these stocks is likely to hold.
Magalu's fundamental outlook is also on the radar: XP's Q3 2026 earnings projection for Magalu pointed to a net loss. Whether that is confirmed or reversed, the figures arriving in November will add another layer of risk on top of macro rate pressures.
January 2031 DI — Above 15.50% signals a new round of pressure for domestic stocks; below 14.50% serves as the first sign of relief for this group of equities.
Cabinet appointments — The announcement of the Finance Minister is the next macro catalyst. Figures associated with fiscal discipline tend to push DI rates down; the opposite perception pushes them up.
Magalu Q3 2026 earnings — Expected in November. Reversing a loss into a profit would change the fundamental narrative around the stock, even in an adverse macroeconomic environment.
