While global markets remained negative after the rapid change in the economic outlook in the minutes of the US Federal Reserve's (Fed) meeting in July and the emphasis on the economic framework that made it difficult for Fed members to make decisions, domestic markets focused on the interest rate decision of the Central Bank of the Republic of Turkey (CBRT).
The minutes of the Fed's July meeting, which was announced yesterday, brought along the seller's course in the New York stock market.
While the minutes revealed that rate hikes will continue until inflation drops significantly in the country and that the pace of rate hikes will depend on incoming data, Fed officials agreed that there is little evidence to date that inflation pressures are easing.
On the other hand, the dilemmas in the minutes that there were risks that there might be an excessive tightening in the ever-changing economic framework with the lagged monetary policy made pricing difficult in the markets.
While the expectations in the money markets that the Fed will raise interest rates by 50 basis points in September rose to 61 percent, albeit limited, the expectation for a 75 basis point increase remained alive with a probability of 39 percent.
While the concern of recession in the country is strengthened by the macroeconomic data received yesterday, the pricing in the bond markets is keeping pace with the said concern.
While retail sales in the US did not change in July contrary to expectations, the second-quarter profit of Target, one of the country's major department stores, fell by nearly 90 percent as consumers avoided discretionary spending due to high inflation.
With the housing and labor market data to be announced in the USA today, the statements of the Fed officials are expected to be decisive on the direction of the markets.
With these developments, the S&P 500 index depreciated by 0.72 percent, the Dow Jones index by 0.50 percent and the Nasdaq index by 1.25 percent in the New York stock market yesterday. Index futures contracts in the USA started the new day with a limited decline.
While the European stock markets followed a sales-weighted course yesterday, the macroeconomic data announced in the region was effective in the decrease in the risk appetite.
Although the Eurozone grew by 0.6 percent quarterly and 3.9 percent annually in the second quarter of the year, it remained below expectations, while the Consumer Price Index (CPI) in the UK, with an annual increase of 10.1 percent, pointed to the fastest rise in the last 40 years.
After the aforementioned data, while the risk appetite decreased with the concerns that the Bank of England (BoE) would become more hawkish, today the eyes in the region were turned to the inflation data to be announced in the Eurozone.
Yesterday, the FTSE 100 index in the UK fell by 0.27 percent, the DAX 40 index in Germany by 2.04 percent, the CAC 40 index in France by 0.97 percent and the FTSE MIB 30 index in Italy by 1.04 percent. Today, index futures contracts in Europe started the new day with a buying weighted course, albeit limited.
While Asian stock markets are also following a sales-oriented course, the record decline in the revenues of Tencent, one of the largest companies in China, is effective in this course.
While increasing signs of slowdown in the economy in China feed the concerns of recession and strengthen the selling pressure in the stock markets, the ongoing crisis in the housing market and the closures caused by the new type of coronavirus (Kovid-19) continue to increase the uncertainties in the country.
The high tension between China and the USA over the Taiwan issue also remains at the center of the agenda. The US administration has announced that it will start official talks with Beijing as part of a new trade initiative with Taiwan, which is in a sovereignty conflict with Beijing in this period of high tensions with China.
With these developments, the Nikkei 225 index in Japan decreased by 0.9 percent, the Shanghai composite index in China decreased by 0.4 percent, the Hang Seng index in Hong Kong decreased by 0.9 percent and the Kospi index in South Korea decreased by 0.2 percent. .
While the BIST 100 index, which continued its upward trend and diverged positively from the global stock markets, broke a record again yesterday, eyes were turned to the CBRT's interest rate decision.
Economists participating in the expectations survey of AA Finans predict that the CBRT will keep the policy rate constant at 14 percent.
BIST 100 index, which carried its highest level record to 2,983.22 points yesterday, also improved its closing record by completing the day at 2,980,00 points, 2.29 percent above the previous close.
After closing at 17.9508 with an increase of 0.1 percent yesterday, the Dollar/TRY is trading at 17.9550 at the opening of the interbank market today.
Analysts stated that today, in addition to the verbal guidance of the CPI in the Euro Zone and the Fed officials in the USA, unemployment applications and second-hand house sales data will be followed, technically, the 3,000 and 3.020 levels in the BIST 100 index are in the resistance position and the 2,950 points are in the support position.
The data to be followed in the markets today are as follows:
10.00 Turkey, international investment position for June
12.00 Euro Zone, CPI for July
14.00 Turkey, CBRT's interest rate decision
14.30 Turkey, weekly money and bank statistics
15.30 US, weekly jobless claims
15.30 US, August Philadelphia Fed manufacturing index
17.00 USA, second hand home sales in July
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