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The stampede that emptied its own shelter — April 2024

◦ Written under index methodology v1 (in effect until 15 Jul 2026). The current series is v2 — readings quoted here may differ from those shown today. See the methodology.

Episode

The extreme

For two months, the Brazilian market enjoyed the luxury of disagreement. Mood was sinking while the appetite for risk still held its ground, and it was in that friction that the information lived — what the investor felt was at odds with what he was willing to risk. April undid the quarrel on the worst possible side: the two axes met at the bottom. And when the money fled the sectors that depend on the cycle, it did not run for the usual shelter — it emptied the shelter too. Banks and utilities, which were supposed to serve as refuge, lost relative premium along with the rest. It was not orderly rotation; it was a stampede. In numbers: Ânima fell from 33.5 to 14.1, the Perene Risk Index collapsed from 62.8 to 7.3 — crossing into the locked regime —, the Cyclical/Non-Cyclical ratio plunged to the bottom of the relative grid, and even utilities and banks gave back much of their defensive premium. The dollar at R$ 5.13, the highest of the sequence.

What happened next

The unanimity did not last. Three months on, in July 2024, the appetite for risk had already retraced its path — it rose from 37.9 to 52.9, back to neutral ground —, while mood stayed at the bottom. And the shelter that April had emptied filled up again: Utilities/IBOV climbed back to the top of the relative grid, exactly the post it had lost. In October 2024 fear sank further (mood at 14.0, appetite at 15.7), but the money already disagreed again, rebuilding cyclicals. A year later, in April 2025, the disagreement had returned inverted: mood in extreme euphoria (77.5) and appetite at 91.0, with the structure pulling toward caution. The friction merely flipped sign.

What did not happen

The meeting of the two axes at the bottom was not capitulation, nor the floor of the cycle. Anyone who read the unanimity of fear as "there is nowhere left to fall" was wrong: over the following six months the return was +3.2%, modest and positive. Nor was the stampede systemic stress — the domestic regime stayed neutral, at 45.1, and appetite was already rebuilding by July. The panic was in the mood axes, not in the macro snapshot.

The honest verdict

The reading captured the right event — the end of the divergence —, but the event said less than it seemed. When mood and risk disagree, there is information in the friction; when they agree, the reading falls silent. The engine itself admitted the modesty: maturing six months later, it classified the case as an insufficient reading, on the shallow base of eight episodes. Agreement in fear is a fact; direction it does not deliver.

Continue reading: The banks leave the seat of honor · The currency that ran 2024 · When every defensive gets crowded →

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Characters: Cyclicals × defensives