Turkish stocks are both the best and the worst in the world this quarter

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Turkish stocks rallied again, extending unchecked this quarter as the pound weakened, prompting local investors to look for ways to protect their savings while making the country’s stocks too cheap to ignore. foreign buyers.

According to Bloomberg, the key Borsa Istanbul 100 index rose as much as 2.7% on Wednesday, a day after the pound hit another record low with shares of exporters, including home appliance maker Arcelik AS and airlines. including Turkish Airlines to be among the biggest winners. The index has risen 32% in local currency terms so far this quarter, marking the best performance among global equity markets. In dollar terms, it is the worst, down 12%.

“When the currency is weak and interest rates are low, stocks stand out as almost one of the few attractive asset classes left to protect savings for locals, especially those who may think they were late catching up to the FX rally. said Burak Isiar, head of equity research at ICBC Turkey Investment in Istanbul.

The pound, which fell on Tuesday following remarks by President Recep Tayyip Erdogan that interest rates would continue to fall, recovered on Wednesday after the Turkish central bank intervened in the markets to stabilize the pound. The currency has weakened by 35% amid cumulative interest rate cuts by 400 basis points since mid-September.

Meanwhile, foreign investors have bought $ 1 billion worth of Turkish stock this quarter through November 19, with the Istanbul benchmark trading close to its lowest level since 2009 in dollar terms.

“Exporters are taking advantage of the weak pound,” Isar said, adding that Turkish stocks are too cheap for foreign buyers in dollar terms. “Overall, Turkish stocks are gaining ground with the current speculation.”

Petros Kranias

* Turks are finding it difficult to make a living and Turkish banks have announced an increase in profits

* Turkey: Central Bank interventions in foreign exchange market led to recovery of the pound

* Turkish pound hits record low against central euro – Central Bank executive resigns

* Erdogan: We are following a risky but correct path in the economy

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Source From: Capital

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