Brazil small-cap stock index jumps 20% in best week on record

The scale of the divergence is the story: a 20% weekly move in small caps against 8.8% for the benchmark implies the rally was concentrated in the least liquid, most domestically geared corner of the market rather than a broad re-rating. That matters because small-cap surges of this magnitude are typically driven by positioning and liquidity rather than durable earnings revisions, and they tend to be the first place froth appears when a market turns. Whether the outperformance persists once the initial flow fades is the open question.