Turkey Wake up call: Macro, Political and Equity News, 22nd April

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Wake – up call

BIST lost 1.34% yesterday as the weakness in European markets and U.S. futures as well as the slide in lira weighed on the sentiment for Turkish stocks. BIST100 index had a lower open and spent the entire day in the negative territory within the 97.3-98.5k range. Banks underperformed with the 2.00% drop in their sector index amid pressure on GARAN and YKBNK. Sisecam Group stocks, BIZIM, LOGO, DEVA, HEKTS, and YATAS were among the better performers for the day while aviation stocks, TUPRS, AYGAZ, MAVI, GOZDE, KRDMD, ULKER, CCOLA, and MGROS topped the non-financial decliners. Today, our main macro highlight will be the Monthly Monetary Policy Council meeting with the decision on policy rates due 2PM local time. Consensus (Bloomberg survey) calls for a median 50bps reduction in the benchmark weekly repo rate to 9.25% while the expectations range between 0 and 100bps. Separately, April'20 Consumer Confidence Index compiled by TurkStat is due at 10AM. The index had climbed 1.7% on a sequential basis to 58.2 in March. BIST seems off to a cautiously positive start given some gains in U.S. and European futures and the slight recovery in lira (USDTRY at 6.9757 vs 6.9869 at yesterday's closing bell) in early trades.
Macro and Political News:
(=/-) Number of deaths from coronavirus reached 2259... According to the Health Ministry, the number of deaths from coronavirus increased by 119 people yesterday and reached 2,259. The total number of tested and infected people are 713,409 and 95,591 in Turkey.

(=/-) Agri input price index up by 8.97%... Input price index for Agriculture sector increased by 8.97% YoY and 0.47% MoM in February 2020

(+) Turkey to sell medical eqiupments to the US... Turkish government approved medical equiment and ventilator spare parts export to the US. According to the daily Sabah, the US government had already requested to buy a large list of items, including medical masks, ventilators and gloves earlier this month.

(=/+) Covid-19 measurements may be relaxed in June... President Erdogan stated that the measurements taken for combatting the coronavirus may be relaxed in June.

(=) Erdogan and Putin talked on the phone... Turkish President Erdogan and Russian President Putin talked on the phone on Tuesday discussing a number of issues. According to the statement, the leaders expressed their readiness to step up joint efforts in the fight against coronavirus, including through the ministries of health and other relevant structures, as well as to continue close coordination to ensure the return of Russian and Turkish citizens to their homeland. The two leaders also discussed on the status in Syria, including the implementation of agreements on the Idlib de-escalation zone, and reaffirmed their support for the territorial integrity of Syria. In the call, the importance of further close cooperation between Russia and Turkey through military and diplomatic channels was also mentioned. Besides, Putin and Erdogan revised the issues of Russian-Turkish cooperation, primarily in the trade and economic sphere, including the implementation of joint projects in the nuclear energy sector, and the expansion of cooperation in the agricultural and transport sectors. (Source, AA, Russian statement)

(=) Turkish Treasury borrowed TL11.2bn... The Turkish Treasury hold bond auction on Tuesday and borrowed TL11.2bn from auctions.

(=) Turkey will differentiate itself this year... Head of Presidency's Finance Office Goksel Asan says world economy will contract this year due to the pandemic, but Turkey will differentiate itself with moderate contraction. He underlined that the key factor will be management of the pandemic.

(=) The Monetary Policy Committee will convene today... The Monetary Policy Committee will convene today in order to discuss the policy rate and the committee is expected to announce the policy interest rate decision at 2.00p.m. Istanbul Time. The consensus is 50bps cut for policy interest rate to 9.25%.


Sector and Company News:

(=) ISCTR bought 5.75mn lots of SISE shares with TRY4.91 – 5.08 price range per share. Its share in SISE reached to 68.86% by this transaction.

(=) PGSUS’s CEO Mehmet Nane stated that 1Q20 results will be post at the beginning of May. He also said that they expect no delay for the delivery of planned airplanes before summer. Mehmet Nane underlined that they have no plan to restructure their financial loans.

ALKIM made changes on the distribution of its dividend of TL3.40 p/s, which was decided to be distributed in one installment earlier, as the companies were limited to 25% of the their net profit until the end of September, 2020. Accordingly, the Company will distribute the upper limit of TL1.14 p/s on April 30, 2020, and remaining TL2.26 p/s will be paid in the 4th quarter of the year according to legal regulations.

RTALB decided to increase its registered capital ceiling from TL50mn to TL250mn.

HEKTS’ new disinfectant brands Hek-off and Hekpak will be on sale as of April. Disinfectants will be produced in 500ml, 1lt and 25lt packages in the first place, by producing 15k liters per day