Turkey Wake-up call: Macro, Political and Equity News, 25th January

BIST took a 5.02% dive yesterday as the sell-off in global equities weighed heavily on Turkish stocks in the afternoon, triggering a market-wide circuit-breaker and causing an early end to the trading session. Banks performed slightly better with the 3.83% loss for their sector index. OTKAR, ISGYO, KARSN, and AYDEM were some of the very few gainers in the BIST100 universe while TUPRS, PETKM, FROTO, TOASO, KRDMD, EREGL, SISE, ASELS, PGSUS, NTHOL, and INDES led the decliners. Coming to this morning, our local macro agenda involves January'22 Manufacturing Capacity Utilization Rate (CUR stood at a 4-year high of 78.7% in December'21 and was 75.4% back in January'21) and Real Sector Confidence index (was at a 13-month low of 106.1 in December'21 and had stood at 107.0 back in January'21) both to be released at 10AM local time. Separately, Treasury will sell 5-year CPI-indexed sukuk papers via a direct placement today in its single domestic borrowing action. Will offer 3-year gold bonds and gold-indexed sukuk papers on Thursday, finalizing its domestic borrowing actions for the month. We foresee a sideways open for the BIST as the optimism related to the strong (1.9-2.2%) overnight rebound in U.S. markets after the BIST close may be balanced out by the weakness in U.S. futures and losses in Asian bourses this morning.