Brazil's Bovespa is down nearly 2% to 47,258.
About a million Brazilians took to the street across 80 cities, prompting president Dilma Rousseff to call an emergency meeting. The protests were sparked a week ago over a hike in bus fares but have mushroomed since.
"We view these protests as a wake-up call that the government needs to continue catering to the new demands of the rising middle class," wrote Barclays' Marcelo Salomon.
"It is not enough to increase social transfers or create stimulus programs to push consumption up. Brazilians are now clamouring for a leaner and more efficient government, one that spends tax revenues in a sound manner, according to their needs. A necessary condition of the uprising was the use of social media, which allowed for a leaderless movement to bring to the streets this incredible demonstration of power."
Brazil's measure of inflation, the IPCA-15 price index climbed 0.38%, above expectations and annual inflation ticked up to 6.67%. Brazil's central bank has a two percentage point tolerance against its 4.5% target.
On Thursday, Brazil's central bank sold currency swap contracts to help support the real which continues to be down 12% against the U.S. dollar since May.
President Rousseff's approval rating has fallen to 55%, according to the CNI/Ibope opinion poll.
Here's a look at Brazil's Intraday chart from Bloomberg:
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