“I’ve never seen anything like this,” said one trader with decades of experience.
Trading was delayed in Sao Paulo’s stock exchange and once it opened the circuit breaker stopped all operations within just a few minutes. That has not happened since the global financial crisis of 2008.
In a fortnight Mr Temer was about to start pushing his economic reform plan through Congress.
Until yesterday markets were very optimistic – but now many don’t see how Mr Temer could keep his job if the alleged tape in which he condones a bribe payment is handed over to authorities.
What happens next? If Mr Temer keeps his job, it will take a herculean effort to get Congress behind him again. If not, the Brazilian Congress will have to choose a new president indirectly.
Getting reforms approved is no longer a top priority for a country still in a deep economic crisis.
Trading has now resumed in Sao Paulo but could be frozen again if stocks fall further.
BBC South America business correspondent.
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