Turkey Wake-up call: Macro, Political and Equity News, 20th April

BIST dropped 2.20% amid heavy-handed selling from one particular foreign broker weighed on the market while local investors also seemed reluctant to participate ahead of the three energy IPOs that are bookbuilding this week. Index had an uptick start, but its limited earlier gains were quickly reversed. The benchmark first retreated to 1,390-1,395 range and then further lower in the last 1.5 hours. Banks underperformed with the 3.23% loss in their sector index. PETKM, TTRAK, MPARK, TKFEN, and AEFES were among the handful gainers in the BIST100 space while FROTO, VESTL, SAHOL, MGROS, ODAS, TKNSA, KORDS, and OTKAR topped the decliners. Today, the Treasury will reissue 4-year fixed-rate bonds and 7-year FRNs and separately offer 5-year CPI-indexed sukuk papers in direct sale in triple domestic borrowing actions, wrapping up this month's heavy borrowing programme. Domestic redemption is TL22.21bn for the week while the total for the month stands at TL37.28bn vs a domestic borrowing target of TL33.0bn while Treasury has already raised TL22.4bn in the six auctions/placements held so far. BIST seems off to a flattish start in absence of visible triggers in either direction as lira has barely changed since last night, U.S. futures are c.0.3% in early trades, and Asian markets are trading mixed.