Turkey Wake-up call: Macro, Political and Equity News, 6th October

BIST climbed 1.37% yesterday on positive sentiment in global markets following Trump's quick recovery from Covid-19 infection. After an uptick start that marked the lowest point of the day, BIST100 index had an almost uninterrupted ascent until the close. Banks again lagged with the 0.68% gain in their sector index. TCELL, GUBRF, CCOLA, AEFES, PETKM, BIZIM, OTKAR, INDES, and Koza Group names led the gainers while SISE, ARCLK, and CIMSA were among the handful of decliners in the broad-based move. Our local macro agenda today involves Central Bank's September'20 real effective FX rate due at 2:30PM local time. The CPI-based index is expected to decline further from its 23-month low of 63.71 mark for the previous month given ~4.0% depreciation of lira vs the currency basket dwarfing the 0.97% headline CPI print for September. Separately, the Treasury will issue 5-year fixed coupon bonds and reissue 4-year TLREF-indexed in double domestic borrowing auctions today. Domestic redemption for the week is a hefty TL19.44bn. BIST is headed for another positive open given continued strength among global equities. U.S. futures are flat, but holding onto their 0.3-0.4% overnight gains after we left and Asian markets are all trading in the green.