MercadoLibre Inc. (NASDAQ:MELI) stock fell nearly 9% in Monday's premarket trading after Brazilian President Luiz Inácio Lula da Silva secured another term, defeating Sen. Flávio Bolsonaro.

The election result rattled investors and triggered a sell-off in Brazilian stocks. Meanwhile, Nasdaq futures edged up 0.02%, while S&P 500 futures gained 0.08%.

Lula secured 51.79% of the valid votes, compared with Bolsonaro's 48.21%, according to Brazil's electoral authority. The victory also highlighted political divisions between Latin America's largest economy and U.S. President Donald Trump.

Lula's Election Victory Sparks Brazilian Stock Sell-Off

Brazilian stocks had surged in recent weeks after Bolsonaro's surprise first-round lead.

Investors expected Bolsonaro to pursue business-friendly reforms, reduce government spending and support privatization.

However, Lula's unexpected victory reversed that outlook. As a result, investors moved to unwind positions tied to a potential Bolsonaro administration.

The selling extended beyond MercadoLibre. Other U.S.-listed Brazilian companies, including Petrobras (NYSE:PBR) and XP Inc. (NASDAQ:XP), also suffered steep premarket losses.

Why Brazil Matters to MercadoLibre

Brazil is MercadoLibre's largest market, making the country's economic outlook critical to its business.

In 2025, Brazil generated $15.2 billion of MercadoLibre's $28.9 billion in net revenue and financial income. That represented approximately 52.6% of the company's total.

Consequently, changes in Brazil's economic policies, consumer spending and business environment could affect MercadoLibre's growth.

MELI Stock Faces Technical Pressure Ahead of Earnings

MercadoLibre shares remain under technical pressure as the company approaches its next earnings report.

At $1,650, the stock trades 10% below its 20-day simple moving average, 12% below its 50-day average and 10.3% below its 200-day average.

This positioning signals weakness across short- and long-term trends. Moreover, the 20-day average remains below the 50-day average, reinforcing bearish momentum.

The stock's relative strength index stands at 46.42, indicating neutral momentum. This suggests shares are neither oversold nor showing signs of a strong recovery.

Traders are watching resistance at $1,924.50, where selling pressure could limit a rebound. Meanwhile, support stands near $1,631.

A break below that support level could bring the 52-week low of $1,495 back into focus.

MercadoLibre shares have declined 20.69% over the past 12 months. The stock's September high and October low also remain important technical markers.

MercadoLibre Earnings and Analyst Outlook

MercadoLibre is expected to report earnings on Nov. 6, 2026.

Analysts expect earnings of $9.37 per share, compared with $8.32 a year earlier. Revenue is projected to reach $10.66 billion, up from $7.41 billion in the prior-year period.

Meanwhile, the stock trades at a price-to-earnings ratio of 49.2, reflecting its premium valuation.

Analysts maintain a consensus Buy rating, with an average price forecast of $2,278.

Citigroup maintained a Neutral rating and lowered its price forecast to $2,100 on Oct. 13. Cantor Fitzgerald maintained an Overweight rating and reduced its forecast to $2,200 on Oct. 12.

Meanwhile, Susquehanna maintained a Positive rating and raised its price forecast to $2,500 on Oct. 6.

MELI Stock Price Activity: MercadoLibre shares were down 8.96% at $1648.00 during premarket trading on Monday, according to market data.