Daily Bulletin

Good morning. As the easing in oil prices continues for the fourth consecutive session, buying is flowing into U.S. and European futures as well as Asian equity markets. That said, we remain cautious on the sustainability of this optimistic tone in global risk appetite. Factors such as Iran’s messaging toward the U.S. and its regional allies, and a renewed decline in vessel transits through the Strait of Hormuz, could reignite rising tension in the coming days. Domestically, we continue to monitor the investigation and liquidation processes that, while representing only a limited portion of the total fund market, are weighing on overall market dynamics. Most recently, the CMB extended the liquidation period previously set at three months to six months. Given the free-float and order-book depth of the shares held by some of the funds under liquidation, we think selling pressure on these assets could persist. In the rest of the market, particularly among high index-weight companies, we may see fund inflows and relatively positive divergence over this period. A renewed rise in expectations for a 100bp rate cut at the MPC’s October 22 meeting could also make the positive divergence of the BIST Banking Index (XBANK) versus the broader market more pronounced. Looking at Friday’s session, the BIST 100 Index fell 1.7% to 13,284 points; the top five contributors to the index were TUPRS, YKBNK, BIMAS, EUPWR and EFOR, while the biggest negative contributors were DSTKF, ASELS, KTLEV, IEYHO and ASTOR. Stocks that have stood out with consistent fund inflows over the past week are TUPRS, EFOR, EUPWR and TURSG. From a technical perspective, the 13,000 / 13,200 area can be monitored as an important support zone, while resistance levels stand at 13,430, 13,580 and the 14,000 / 14,100 area. The economic calendar is quiet today. Turkey’s 5-year CDS premiums are starting the day at 233 basis points.