TFG Istanbul Morning Report (TFG Istanbul Menkul Değerler )

WORRIES OF INFLATION AND AGGRESSIVE RATE HIKES FROM FED PRESIDENTS CONTINUE TO STRAIN MARKETS
• The BIST100 saw panic-selling in the afternoon, falling to as low as 3049, and heading for an apparent circuit-break as the losses neared the 5% cut-off level, before investors gathered their composure and started buying from dip, thus closing the day 1.60% lower at 3147, and turnover of TRY 55.2bn.
• The losses were relatively uniform across the board, with the Aviation stocks facing less of a selling appetite due to the previous day’s harsh sell-offs.
• The Energy stocks-especially the renewable energy stocks, were the most sold, with ALARK closing limit-down, after the Turkey energy regulator EPDK stated that it will continue to impose maximum price reconciliation policy for another 6 months. Maximum reconciliation price for natural gas power plants 4,500 liras ($243) per MWh, imported coal plants 2,750 liras, local coal plants 2,050 liras and 1,540 for renewable energy power plants. The difference between maximum price and market price will be pooled and used to compensate consumers.
• ASELS, VESTL and EREGL were the highest gainers, whereas KOZAA, TTKOM and TKFEN faced the most sell-offs among the BIST30 stocks.
• Today, we expect a flat to slight-negative opening at the BIST.
• The TRY strengthened against the greenback to 18.50 yesterday, but has since weakened to 18.53, and the DXY has fallen to 112. Whereas the 2yr bond yields were unchanged, the 10yr rates rose by 19bps to 11.93%. The 5yr CDS rates rose by 12pts to close yesterday at 792.
• On the commodity front, Brent is trading lower, hovering around the USD 87 level, and both ounce and gram GOLD also pared yesterday’s gains to trade at USD 1658 and TRY 986, but have since risen considerably to USD 1666 and TRY 993, respectively.
• Federal Reserve Bank of Cleveland President Loretta Mester said the FED has to keep tightening policy to get prices under control, adding that she expects interest rates may need to go a little higher than a number of her colleagues expect, and Federal Reserve Bank of St. Louis President James “Bullish” said US central bankers expect additional policy tightening in coming months and that has been understood by investors, and Fed San Francisco President, Mary Daly stated that year-end interest rates should be around 4.50-5.00%. Apparently, Daly was among those 6 that entered 5% for 2023 in dot plot.
• Last night, Turkish President Erdogan held a phone call with Russian President Vladimir Putin, urging Putin to give negotiations on Ukraine war another chance.
• The S&P has increased Turkey’s 2022 GDP growth rate by 1.7% to 5.2%, and increased it by 1.1% for 2023 to 2.8%, and expects inflation to fall to 40% for 2023, forecasting it to stay around the 80% level for much of 2022 due to expansionary economic policies and high energy costs.
NEWS FLOW:
• TAVHL: According to the daily Dunya, its operations will include metros, auto-parks and lodging under its “airport-city” concept.
• Natural gas supplier, BOTAS, has left prices unchanged for the upcoming month.
• The switch for corporates to the Currency-Linked Savings Accounts has been extended to the end of September.
• Last week, Foreigners were net SELLERS of USD 204mn STOCKS, but net BUYERS of USD 18mn BONDS.
AGENDA:
On the local front, the August Trade Balance, and the Bloomberg September Turkey Economic Survey will be released, and the S&P’s Turkey sovereign rating will be released, currently at B+ with a negative outlook.
On the international boards, the US personal income data, Chicago PMI, and Michigan Consumer Sentiment numbers will be released, as well as the German and Eurozone CPI figures and PPI figures, as well as Unemployment.
 
 
 TFG Istanbul Menkul Değerler A.Ş.
  www.tfgistanbul.com/arastirma-raporlar
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                  Yasal Uyarı
 
 Burada yer alan yatırım bilgi, yorum ve tavsiyeler yatırım danışmanlığı kapsamında değildir.Yatırım danışmanlığı hizmeti ; aracı kurumlar, portföy yönetim şirketleri, mevduat kabul etmeyen bankalar ile müşteri arasında imzalanacak yatırım danışmanlığı sözleşmesi çerçevesinde sunulmaktadır.Burada yer alan yorum ve tavsiyeler, yorum ve tavsiyede bulunanların kişisel görüşlerine dayanmaktadır.Bu görüşler mali durumunuz ile risk ve getiri tercihlerinize uygun olmayabılır.Bu nedenle, sadece burada yer alan bilgilere dayanılarak yatırım kararı verilmesi beklentilerinize uygun sonuçlar doğurmayabilir.