Brazilian stock markets started the first trading session of the year in reversal mode, with investors reacting badly to an inauguration speech by President Luiz Inacio Lula da Silva that suggested a more interventionist agenda towards the economy and state-controlled companies.

The Ibovespa index in the Sao Paulo stock exchange was down more than 3% in afternoon trading, while state-controlled oil player Petrobras was falling close to 6%.