Turkey Wake-up call: Macro, Political and Equity News, 11th January

BIST added 1.21% on Friday, carrying the total gains for the first week of the year to 4.33%. Benchmark BIST100 opened higher and spent all the day in the positive territory except for a brief incursion to the negative zone after 11AM. Banking index was up 1.28%, in line with the broader market, amid the strength in ISCTR and GARAN vs some profit taking in AKBNK. KOZAL, NETAS, HEKTS, CCOLA, SOKM, AEFES, AGHOL, EREGL, and KRDMD topped the gainers for the day while EKGYO, TTRAK, GUBRF, ENJSA, OTKAR, and BRISA were among the weak spots. Today, our local macro agenda involves unemployment statistics for October'20 to be released at 10AM local time. Headline unemployment had declined 0.5pp on a sequential basis to a 22-month low of 12.7% in September while also remaining below the 13.8% level for the same month of 2019 although this was mostly attributable to the 3.0pp yoy decline in the labor participation rate to 50.5%. Separately, November'20 Balance of Payments data are also due 10AM. Bloomberg survey puts the monthly CA deficit at USD3.56bn vs the insignificant USD15mn deficit recorded for the same month of 2019. We predict a downtick open for the BIST given softer mood in global markets and some weakness in lira (USDTRY above 7.46 mark vs 7.3516 at Friday's closing bell). U.S. futures are down almost 0.6% while Asian stocks are trading mixed.