Turkey Wake-up call: Macro, Political and Equity News, 2nd November

BIST lost 1.30% on Friday, carrying its cumulative losses for the painful week to 6.57%. Benchmark BIST100 opened gap lower and spent the entire day in the negative territory as the weakness in lira and most global peers weighed on the sentiment. Banks lost 1.73% on average with TSKB and YKBNK managing to buck the sell-off. FROTO, TOASO, OTKAR, ARCLK, EREGL, PETKM, ISMEN, and BRISA led the shorter list of non-bank gainers while BIMAS, ASELS, TCELL, SISE, Kozaa Group names, AEFES, SOKM, MGROS, AYGAZ, MPARK, INDES, TRGYO, and TATGD were among the weakest plays. Today, our macro agenda involves October'20 PMI that will be announced at 10AM local time. The index had retreated 2.8% on a sequential basis to 54.3 in September as the sharp recovery after the pandemic had lost some steam, but had remained above the 50 neutral line for the fourth consecutive month. We foresee a slight positive open for the BIST given better mood abroad and some cautious gains in lira (USDTRY at 8.3553 vs 8.3673 at Friday's closing bell). U.S. futures are up almost 0.4% in early trades on top of the 0.5% overnight gains after we closed on Friday and Asian markets are almost all trading in the green.