Daily Bulletin

Good morning. Global markets are balanced, with cautious optimism stemming from expectations that U.S. President Trump may soften tariffs on the automotive sector. Domestically, rising interest rates continue to increase financing costs, and combined with weak balance sheets and ongoing risks, this has sustained the consolidation in Borsa Istanbul within the 9250–9500 range for the past month. Momentum indicators, which had shown signs of recovery until yesterday, have turned negative following a 1.3% decline. In BIST, the 9250 and 9000/9100 levels should be monitored as support zones. In the case of a recovery, resistance levels to watch include 9390, 9500, and 9580. We are currently in a period of intense Q1 2025 financial disclosures. Although banks and insurance companies have generally reported results above expectations, weak outlooks for Q2 remain a limiting factor, especially for the banking sector. In the industrial and services segments, although only a few Q1 results have been announced so far, the season has not started off on a strong note. Weak balance sheets and rising interest rates may lead to further downward revisions in company target prices, a trend we have already started to observe. Given the weak outlook on both technical and fundamental fronts, we maintain our view to stay defensive and keep risk exposure limited in BIST. In addition to Q1 2025 earnings, a dense data calendar is on the agenda, which could increase volatility depending on the results. Turkey's 5-year CDS spreads start the day at 357 basis points.