Active followers of the iShares MSCI Brazil Capped ETF (NYSEArca: EWZ) know a few important points about the ETF’s near- to medium-term fortunes.

First, it is accurate to say the country’s October national elections are, quite simply, a big deal. Second, as EWZ has so frequently shown this year, investors would clearly prefer a loss for President Dilma Rousseff. [Trouble for Rousseff is Good for Brazil ETFs]

With those points in mind, it can be argued that EWZ being up just a third of a percent today is disappointing when considering the latest polling data out of Brazil. The latest Datafolha poll shows new candidate Marina Silva with 47% of the vote compared to 43% for Rousseff. Silva is the candidate replacing Eduardo Campos who died in a plane crash last week.

While Silva is benefiting from an emotional bounce in the wake of Campos’ death, EWZ’s lethargic performance Wednesday (the ETF has typically rallied in impressive fashion on bad polling data for Rousseff) could be the result of financial markets knowing that Silva’s rivals, Rousseff and Social Democratic candidate Aecio Neves, can outspend her, reports Dimitra DeFotis for Barron’s.

Nomura notes that Silva can cement her status as a credible threat to Rousseff by moving to the center and convincing Brazilians, particularly the poor and under educated, that she truly is an agent of change, according to Barron’s.

Assuming the current poll numbers hold, Silva would face Rousseff in a run-off because a run-off can be averted only if one of the candidates garners more first round votes than the other two candidates combined. [Close Call for Brazil ETFs]

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