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

BIST climbed 1.23% yesterday despite the weakness in European markets as Turkish stocks seemed to be licking their wounds after Wednesday's sharp drop. Banks added 0.96% on average with YKBNK and TSKB outperforming their peers. Aviation stocks led by PGSUS, SISE, ENKAI, KARSN, DOHOL, AKSEN, GWIND, and MAVI stood out among the non-bank gainers in the BIST100 universe while TOASO, BIMAS, KCHOL, TTRAK, NTHOL, GLYHO, SELEC, DEVA, and SOKM were some of the fewer decliners. Today, our local macro agenda showcases the unemployment statistics for April'22 to be released at 10AM local time. Seasonally-adjusted unemployment had worsened 0.4pp from a month ago to 11.5% in March on the back of the 59k monthly decline in the number of employed along with the 96k increase in labour force (labour force participation was sequentially up 0.1pp to 52.6%). BIST seems headed into a flattish start as the array of government & regulatory measures announced last night do not include any visible headwinds for the stocks, in our view. On the other hand, sentiment in global markets is sour with 1.3-1.7% overnight losses in the major U.S. indices after we left and Asian bourses outside of China all trading in the red this morning. Lira is a tad stronger with the USDTRY pair hovering around the 17.00 mark vs 17.2450 at yesterday's closing bell, but up from lows of 16.77 touched last night in anticipation of new government measures to prop up the currency.