Turkey Wake-up call: Macro, Political and Equity News, 10th February

BIST added 0.60% yesterday as some institutional buyers seemed to have returned to the scene, especially in key banking names. After a cautiously positive open, BIST100 index gradually climbed to 1,550 levels and spent most of the day in an 8-point range around this level except for a short-lived retreat in late afternoon. Banks outperformed visibly with the 2.40% gain in their sector index as GARAN, AKBNK, and VAKBN caught some bids. TUPRS, ASELS, FROTO, KOZAL, PETKM, YATAS, and GOODY led the non-bank gainers while grocery-chains, EKGYO, DOHOL, TTRAK, GOZDE, ODAS, and CIMSA were among the weak spots. Today, our local macro agenda involves unemployment statistics for November'20 to be released at 10AM local time. Headline unemployment had remained unchanged on a sequential basis at its 22-month low of 12.7% in October while also remaining below the 13.4% level for the same month of 2019 although this was mostly attributable to the 3.0pp yoy decline in the labor participation rate to 50.0%. Meanwhile, seasonally-adjusted unemployment had inched up 0.1pp on sequential basis to 12.9%.
Separately, investors will keep an eye on President Erdogan's scheduled speech at his parliamentary group at noon local time. We predict a slight positive start for the BIST given prevailing strength in global markets and sustained recovery in lira.