Turkey Wake-up call: Macro, Political and Equity News, 15th October

BIST added 1.24% yesterday as the prevailing positive sentiment was beefed up by President Erdogan's announcement due on Saturday regarding expansion of the natural gas reserves found in the Black Sea. After some wobble in early trades, BIST100 index turned north and gradually climbed to 1,183 and then onto 1,189 where it closed. Banks again fell behind with the 0.50% gain in their sector index. Strength in non-banks like PETKM, TUPRS, TCELL, KCHOL, TKFEN, TTRAK, FROTO, and energy stocks carried the index higher while TTKOM, REITs, and cement producers were among the decliners. Coming to this morning, our local macro agenda highlight is the September'20 central government budget numbers due at 11AM local time. Separately, TurkStat will release the residential sales data for September’20 at 10AM. Home sales had jumped 54.2% yoy to 170k units in August on the back of the 122.6% surge in mortgage-backed transactions as the consumers tried to take advantage of the historically-low mortgage rates and advantageous loan terms before banks started upward adjustments. BIST is off to a slight negative open given the weaker mood abroad and some slide in lira (USDTRY at 7.9254 vs 7.9012 at yesterday's closing bell). U.S. futures are down 0.3% in early trades on top of the 0.5-0.7% overnight losses in main indices after the hour we left and Asian markets are mostly trading in the red.