Daily Bulletin

Good morning. Iran’s closure of the Strait of Hormuz is fuelling pessimistic expectations that oil prices could reach as high as USD 200 per barrel. Frankly, while we do not yet share such an overly bearish view, we believe oil prices could find a balance around current levels given that risks have already been priced in since the beginning of the year. That said, the key variable will be how long the process lasts and for how long the Strait of Hormuz remains closed. Scenarios involving higher oil prices would increase inflationary effects and downside risks to growth, which is negative for global economies and equity markets. US and European futures, as well as Asian equities, are in the red this morning. In Borsa Istanbul, despite opening below 13,000 yesterday, the index staged a rebound toward around 13,300 during the session and closed at 13,346, down 2.7%. The top five positive contributors to the index were ASELS, TUPRS, BIMAS, PETKM and MGROS, while the main negative contributors were AKBNK, THYAO, YKBNK, KLRHO and ISCTR. Over the past week, names drawing attention due to steady fund inflows include ASELS, CIMSA, FROTO, GUBRF, ASTOR, MGROS, CCOLA and ODINE. From a technical perspective, 13,000 is a critical support level; if breached, 12,550 and 12,300 would come into focus as the next supports, while resistance levels stand at 13,450 and 13,700. On today’s domestic agenda, February inflation data takes centre stage. We expect CPI to rise 2.9% m/m, lifting headline inflation to 31.5% y/y from 30.7%. CPI figures will also be monitored in Europe. In the US, headlines regarding the legal process involving Halkbank will be followed later in the day. Turkey’s 5-year CDS spreads start the day at 239 bps.