Market Watch (Şeker Yatırım)

Market Watch - Friday, September 8, 2023
Outlook:
The BIST 100 Index started Thursday on a positive trend, although it then saw intraday fluctuation. The Benchmark Index peaked at a record 8,358, ending the day at 8,337.67, up 1.91%. The Banking Index rose by 2.11% and the Industrial Index by 1.66%. As non-residents resumed their buyer positions after three weeks of sales, both foreign and domestic investor interest continues to support the BIST. We expect domestic investor interest to continue as long as high inflation and the negative real interest policy continue, and foreign investor interest to continue as long as the transition to orthodox policies and normalization is maintained. Moreover, in the short term, Mehmet Simsek's meeting with foreign investors in the USA on September 19 may remain a source of motivation for the Index. However, we consider it normal and healthy for the BIST to experience profit realizations from time to time, having gained nearly 80% without any significant correction in the post-election period. While global stock markets ended the day with mixed movements, this morning U.S. futures and German DAX futures are trading positively. Asian Stock Markets in general are trending negatively. Risk appetite remains weak due to the expectation that the Fed may continue to raise interest rates, and to recession concerns sharpened by weak data from China. The VIOP-30 Index ended the evening session up 0.19%. Locally, the Benchmark Index seems set to start Friday positively. Intraday profit-taking should merely present a buying opportunity. SUPPORT: 8,295 - 8,184 RESISTANCE: 8,390 - 8,496.
Money Market:
The Lira was negative yesterday, weakening 0.05% compared to the USD to close to 26.8341. In addition, the currency depreciated by 0.03% against the basket composed of $0.50 and €0.50. Meanwhile, the local fixed income markets were negative. The ten-year benchmark bond was ending at 20.76%, 1.46 pp above its previous closing.
Sector News:
BRSA weekly: Currency protected deposits fall by TRY60bn and 1.8% over the past two weeks. According to weekly BRSA data as of September 1, 2023, the sector's FC deposits (in $ terms) declined by by a limited USD211mn to USD205.9bn on a weekly basis after a sharp rise of USD7.7bn and 3.8% over the past three weeks.
There was a 0.1% decline in FC deposits (in $ terms) WoW at state deposit banks, and foreign and private deposit banks' FC deposits fell by 0.2% WoW. The share of FC deposits in total deposits rose by 10bps weekly to 42.3%.
Currency-protected deposits fall by as much as TRY60bn and 1.8% over the past two weeks, ongoing decline in their weight in FC deposits. TRY volume fell by 0.6% and by TRY20bn WoW to TRY3.35 trillion. This marks the second weekly decline in a row amounting to TRY60bn and 1.8%. In dollar terms, the volume also fell by 1.3% weekly to USD126bn following a solid USD21.5bn rise over the past 8 weeks. Their weight in FC deposits fell by a further 70bps WoW to 61.2%.
Individual FC deposits (in $ terms) rose sharply WoW. Individual FC deposits (in $ terms) rose by USD763mn and 0.6% on a weekly basis. Yet commercial institutions FC deposits (in $ terms) fell by USD911mn, and 1.2% WoW. Lastly, official and other institutions' FC deposits fell by USD63mn and 1.2% WoW.
Limited rise in TRY deposits. Total TRY deposits rose 0.1% WoW. Individual deposits rose by TRY30bn and 0.7%, while those of commercial institutions fell by TRY63bn (+2.5%) WoW. Other institutions' TRY deposits rose sharply by TRY44bn and 6.9% WoW.
Spreads narrowing for the first time in 4 weeks. On the funding side, the weighted average interest rate on TRY deposits with maturities of up to 3 months rose sharply by 683bps WoW to 37.59%. The weighted average interest rate of TRY commercial loans (excluding overdraft and corporate credit cards) rose 483bps WoW to 37.37%. Thus, the spread between TRY commercial loan rates and 3M TRY deposit rates narrowed 22bps for the first time in 4 weeks. In the previous week, loan rates were 178bps above deposit rates.
Across-the-board rise in FC long positions. According to weekly BRSA data dated September 1, 2023, the sector's FC long position rose by 11% WoW to 5,079 million dollars.
State and private deposit banks' long position rose by 12% on a weekly basis to $1,737mn and 1,592 million dollars, respectively. On the other hand, for foreign deposit banks, it rose by 10% WoW to 1,502 million dollars.
The sector's FC net general position/regulatory capital ratio rose to 6.0% from 5.4% in the previous week. On a segmental basis, this ratio is 6.6% and 7.8% in state and foreign deposit banks, and 5.9% in private deposit banks.
Company News:
Cimsa (CIMSA.TI; OP) has announced Cimsa Americas Cement Manufacturing and Sales Corp.'s decision to invest in a gray cement grinding plant. The facility, which will have an annual average grinding capacity of 600k tons, is planned to be completed in the last quarter of 2025. It was reported that the entire investment, projected to have an estimated budget of 82mn USD, will be financed by Sabanci Building Solutions BV's own resources.
Turkish Airlines (THYAO.TI; OP) has released its traffic figures for August 2023 with PAX growth of 10.7% YoY thanks to the support of increased domestic passengers compared to August 2022. THY's total PAX in August 2023 was at 8.7mn. Meanwhile, the share of international PAX in total PAX was 63.1% in August 2023. Prepared to benefit from the potential further recovery of passenger traffic, the total load factor was 0.1 pp higher YoY at 86.2% in August 2023. The carrier's international PAX rose by 5.6% YoY to 5.49mn in August 2023; domestic PAX also increased, up by 20.6% YoY to 3.21mn in August 2023. Also, THY's cargo operations volume were flat, down by 1.0% YoY in August 2023. The Company's announced August 2023 traffic data indicates that the share of international passengers in the total passenger number has maintained its strong share, and that the sustained higher travel demand effect supports approximating the figures of 2019 Meanwhile, the significant improvement in domestic PAX number continues to support the Company's operations.
Yapi Kredi Bank (YKBNK.TI; OP) has issued its first sustainable Eurobond with a nominal value of USD500mn. The redemption date is October 16, 2028, with a maturity of 5 years 1 month and fixed coupon payments every 6 months. The yield and coupon rates are at 9.375% and 9.25%, respectively. The issuance is planned to be completed on September 13, 2023, upon receipt of the Issuance Certificate from the CMB.
As may be recalled, the yield and coupon rates were 9.125% and 9% for Vakifbank's (VAKBN.TI; MP) latest USD750mn Eurobond issue with a redemption date of October 12, 2028, a maturity of 5 years 1 month, and fixed coupon payments every 6 months.

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