Daily Bulletin

Good morning. Global markets are displaying a cautious and sideways trend ahead of this evening’s Fed rate decision and tomorrow’s BoJ meeting. Meanwhile, last-minute developments on the trade front are capping optimism. U.S. Treasury Secretary Bessent, during talks held in Stockholm, stated that a preliminary agreement had been reached with China to delay tariffs, but emphasized that the final decision rests with President Trump. Should Trump withhold approval, the tariffs may revert to their April 2 levels. Bessent also noted that no summit is planned between Xi and Trump, that the 90-day extension is merely an option, and that a new meeting may be scheduled after that period. This ongoing uncertainty is contributing to a mildly positive tone in U.S. and European futures, while Asian markets are seeing limited recoveries following earlier profit-taking. Nonetheless, the overall picture in Asia remains mixed. The Fed is expected to keep interest rates unchanged. However, messages from the dot plot and Powell’s tone could influence not only today’s market pricing but also shape global risk sentiment for the remainder of the week. Turning to domestic markets, the BIST 100 index delivered a weak performance over the first two trading days of the week amid continued capital outflows, closing yesterday down 0.52% at 10,487 points. This marks the lowest closing level since July 18, with daily trading volume recorded at TRY 85.8 billion. However, we observed a slight deceleration in net outflows as of yesterday. The release of Q2 2025 earnings after market close—mostly exceeding expectations—along with the ongoing option for a 90-day extension in China-U.S. trade talks, may prompt a rebound attempt in the index today and support a retest of the 10,700 resistance level. That said, weak overall expectations for the second quarter continue to pose a challenge. Therefore, more robust catalysts will be needed for any upward move to be sustained. Initial resistance stands at 10,700, followed by 10,800 points. On the downside, if the index falls below 10,500, we will be monitoring the 10,450–10,300 range as the key support zone. From a long-term valuation perspective, the 13,900–14,000 point target range remains in place. Turkey’s 5-year CDS premium begins the day at 275 basis points.