"Stock exchange drops 4% and dollar goes to R$5.78 because of fear of populism with Lula in the running," said the top article in the Market section of Tuesday’s (9) Folha printed newspaper.

In a headline, the Valor Econômico newspaper said that the "Lula risk" soured the market’s climate, while O Globo mentioned that the dollar had reached its highest exchange rate with the Real since May 2020. On a smaller note, the O Estado de S. Paulo newspaper said that the annulment of Lula's convictions had brought down the stock exchange.

On Wednesday (10), yet another article in Folha stated that Lula's rise would delay the rupture of the financial market with Bolsonaro. Another said that the investor saw more fiscal risk with the PT (Workers Party)than with the current president.

The bad climate of the financial market responded, according to the operators themselves, to something that happened on Monday (8): the return of political rights to former President Lula, the result of the decision of the Supreme Court Justice Edson Fachin to annul Lula's Car Wash convictions that had been handed down by the Federal Justice of Curitiba.

A day later, the Supreme Court resumed the case on the partiality of Sergio Moro. The court can annul the acts of the former judge in cases involving Lula.

The nervousness of the markets reflected in the pages of newspapers was great, but it only lasted two days, until Lula himself spoke on Wednesday.

In his first speech after having his convictions overturned, Lula made harsh criticisms of Bolsonaro's performance in the pandemic and the role of the press during the Car Wash operation.

As for the financial markets, he said he was surprised by the fear of the possibility of his candidacy, especially after a peaceful coexistence for two terms.

In view of the coverage, some readers again questioned the relevance given by the press to the opinion of the financial market on political facts.

The precarious efforts to interpret the chances of the PT's return to the Planalto, as well as the speed with which financial operators abandoned the matter, drew attention.

It is normal for the press to seek to explain why the Stock Exchange rose or fell, listening, as expected, to the operators of that market.

However, the logic of the financial market is, in general, short-term. Thus, the operator or analyst who speaks today about a supposed Lula candidacy in 2022 is not necessarily trying to understand what a new term for the ex-president would look like, but what the effects of this news will be on the allocation of assets in the coming days. Or minutes.

Over the course of Wednesday, the movements of the main financial assets returned to responding to more immediate concerns, such as the risks that involved the approval (which occurred two days later) of the fiscal adjustment measures that would serve as a counterpart to the new round of financial assistance.

Capturing the change, Folha returned to the "Lula effect," but this time, listening to economists of different profiles in a report published in the print edition of Thursday (11) under the title "After speech, it becomes more difficult for the market to reissue 'Lula risk, ' say analysts."

On Friday (12), panic seemed like something from the last century.

In an interview with BBC News Brasil published in Folha, Mark Mobius, a foreign investor whose focus is on developing countries, said that a Lula government would not frighten, and that if "populism" gives rise to a growth spurt, all the better.

In Valor, economist Delfim Netto said he saw no reaction against Lula's eventual election, as there was no "president who protected the financial market the most and had a good relationship with businessmen."

Financial market representatives must be heard like any other relevant participant in the economic debate. But the reader loses when the newspaper limits itself to listening to a group that is sometimes not very expressive of operators or when it fails to take into account the expectations of other markets (such as the consumer, the labor market, companies and so on).

The events of the past few days show how ephemeral interpretations can be, a problem that does not need to be solved by the financial market, which operates in this logic, but by the press, whose function is also to fuel reflection and debate.

These are provisional and risky readings, which try to establish a relationship between complex financial events and the latest political novelty - involving Lula, Bolsonaro or any other character.

Lula's return to the game was the big news of the week and it is important to understand its economic and political effects. Explaining the oscillations of the stock exchange, the dollar or future interest rates without the result sounding like a fragile set of disconnected narratives or hasty conclusions is a challenge for economic journalism.

Flavia Lima: A reporter specializing in economics, she graduated in social sciences from USP and in law from Mackenzie. She has been the ombudsman for Folha since May 2019.

_{Translated by Kiratiana Freelon}