Turkey Wake-up call: Macro, Political and Equity News, 19th January

BIST jumped 2.12% yesterday as buyers returned to the scene after two days of losses. After a wobbly start and cruising in negative territory during the first two hours of trade yesterday, BIST100 index started a gradual ascent after noontime and climbed almost uninterruptedly until the close. Banks again fell behind with the 1.11% increase in their sector index. Steelmakers EREGL and KRDMD, FROTO, AYGAZ, CCOLA, AKGRT, and TOASO topped the gainers while SISE, HEKTS, GUBRF, and SELEC were among the decliners in the broad-based rally with gainers outnumbering decliners 88-11 in the broad-based move. Today, our local macro agenda is muted apart from Treasury's issue of 15-month discount bonds and 5-year TLREF-indexed bonds in double domestic borrowing auctions, wrapping up this month's heavy borrowing programme. Domestic redemption is TL2.84bn for the week while the total for the month stands at TL37.20bn vs a domestic borrowing target of TL25.4bn while Treasury has already raised TL16.75bn in the four auctions/placements held so far. BIST is headed for a positive start as the risk appetite seems to have returned to the global markets. U.S. futures are up 0.6% in early trades while Asian markets outside of China are all trading in the green. Lira is also a bit stronger with USDTRY pair at 7.4767 vs 7.4946 at yesterday's closing bell.