Market Watch (Şeker Yatırım)

Market Watch - Monday, September 4, 2023
Outlook:
The BIST100 Index started Friday on a positive trend, tested a new peak of 8,060 and closed the day at 8,056.12, up 1.75%. The Benchmark Index closed at a new historical high with widespread purchases on Friday. While foreign purchases were the main driving force in the BIST's post-election rally, foreigners have also made strong sales of $518 million over the past three weeks. Despite this, the Index continues its uptrend with the effect of strong domestic demand. The expectation is that the high inflation and negative real interest rate environment will continue for a while, and that foreign investor interest will continue in the medium term with the transition to rational policies being a positive catalyst for the BIST. In the short term, the new medium-term program, set to be announced this month, and Mehmet Simsek's meeting with foreign investors in the USA on September 19 may remain a source of motivation for the index. However, we think that if foreign outflows continue in the short term the uptrend may lose momentum, and a volatile course may occur with occasional profit sales, albeit limited. Unless there is an increase in deposit interests that would satisfy TRY investors the Index will likely continue to present a buying opportunity, even if profit sales are experienced. While the short-term weak outlook for global risk appetite continues, major stock markets finished Friday with a mixed outlook. Risk appetite is expected to remain weak and a fluctuating course will occur until the Fed's interest rate decision. The U.S. markets will be closed today for Labor Day. Locally, the August inflation print emerges today. While the consensus expects CPI inflation to increase by 7.08% for the month, our forecast is for a monthly increase of 6.5%. Relative to the BIST's close, while the U.S. and German futures were almost flat, Asian Stock Markets started the new week with a buying trend. The VIOP-30 Index closed the evening session with a limited positive trend. And at the bourse, the uptrend will continue with any profit-taking being using as a buying opportunity. SUPPORT: 8,013 - 7,910 RESISTANCE: 8,097 - 8,192.
Money Market:
The Lira was negative on Friday, weakening 0.22% compared to the USD to close to 26.7216. In addition, the currency appreciated by 0.03% against the basket composed of $0.50 and €0.50. Meanwhile, the local fixed income markets were relatively flat. The ten-year benchmark bond ending at 19.30%, unchanged from its previous closing.
Headlines:
*** Turkish price indices for August will be announced today. The market expectation is that CPI will increase by 7.08% mom and 56.02% yoy. As Seker Invest, we expect CPI to rise by 6.5% mom and 55.17% yoy in August. Our detailed analysis after the data emerges will be published during the day.
Sector News:
*** With the Presidential Decree published in the Official Gazette, the credit guarantee limits per SME within the scope of the credit guarantee system have been increased to TRY150mn from TRY100mn while the figure has been increased to TRY500mn from TRY350mn from 350 million for large enterprises.
In addition, with the temporary provision added to the decision, businesses beyond the definition of SME, but now included in the definition with the new regulation are given the opportunity to benefit from the credit guarantee limits determined for "non-SME businesses" until 31 December 2023.
*** BRSA weekly: Steep USD4.5bn and 2.2% weekly rise in FC deposits (triggered by Individual deposits). According to the weekly BRSA data as of August 25, 2023, the sector's FC deposits (in $ terms) rose by as much as $4.5bn on a weekly basis and by 2.2% WoW to USD206.2bn. The increase in the last three weeks reached USD7.7bn.
There was a 2.2% rise in FC deposits (in $ terms) WoW at state and foreign deposit banks, respectively. For private deposit banks FC deposits rose 2.3% WoW. The share of FC deposits in total deposits rose by 40bps weekly to 42.2%.
The first weekly decline in Currency-protected deposits since January, the decline in its share in FC deposits. TRY volume fell by 1.2% and by TRY39bn to TRY3.41 trillion. This marks the first weekly decline after the 3.2% weekly decrease seen in the week of January, 6th.
In dollar terms, volume was up by 0.9% weekly to a record high of USD127.6bn. Growth in dollar terms in the last 8 weeks reached a solid USD21.5bn. Their weight in FC deposits fell by 80bps WoW to 61.9%.
Individual FC deposits (in $ terms) rose sharply WoW. Individual FC deposits (in $ terms) rose sharply by USD3.3bn and 2.6% on a weekly basis. Commercial institutions' FC deposits (in $ terms) rose by USD1.4bn, and 1.9% WoW. Lastly, official and other institutions' FC deposits fell by USD147mn and 2.8% WoW.
WoW decline TRY deposits. Total TRY deposits fell 1.4% WoW. Individual deposits declined by TRY34bn and 0.8% while those of commercial institutions rose by TRY28bn (+1.1%) WoW. Other institutions' TRY deposits fell sharply by TRY101bn and 13.6% WoW.
A sharp rise in TRY deposit interest with up to 1 month maturity, commercial loan rates remain above deposit rates. On the funding side, the weighted average interest rate on TL deposits with maturities of up to 1 month increased sharply by 215bps WoW to 25.06%. For up to 3M maturity, TRY deposits rates rose by a further 70bps WoW to 30.06%. The weighted average interest rate of TRY commercial loans (excluding overdraft and corporate credit cards) rose by 126bps WoW to 32.54%. Thus, the spread between the TRY commercial loan rates and 3M TRY deposit rates improved to 178 basis points from 122bps.
Steep rise in FC long position of private deposit banks, contrary to the industry trend. According to weekly BRSA data dated August 25, 2023, the FC long position of the sector fell by USD5mn WoW to 4,591 million dollars.
State and Foreign deposit banks' long position fell by 10% and 1% on a weekly basis to $1,554mn. and 1,368 million dollars, respectively. On the other hand, for private deposit banks, it rose by 12% WoW to 1,421 million dollars, and the only rise occurred in this segment.
The sector's FC net general position/regulatory capital ratio eased to 5.4% from 5.7% in the previous week. On a segmental basis, this ratio is 5.9% and 7.1% for state and foreign deposit banks, and 5.% for private deposit banks.
Company News:
Turkish Airlines (THYAO.TI; OP) is to purchase a total of ten A350-900 aircraft from Airbus to be delivered in 2025, 2026 and 2027 in line with its growth targets (Neutral).



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