Morning Note /
Global

Turkish equities started the new year on a strong note

  • Depreciation in Lira supported exporters & businesses with foreign-currency revenue streams.

  • Banks also joined the party with YKB, Isbank and Akbank leading while Garanti was interestingly a laggard.

  • After FED’s hawkish minutes, all eyes will continuously be on UST10s, especially with December CPI coming this Wednesday

ATA Invest
10 January 2022
Published byATA Invest

Turkish equities started the new year on a strong note, rising 9.5%, led by the 7.99% increase in industrials as the depreciation in Lira supported exporters & businesses with foreign-currency revenue streams such as steelmakers, transportation companies.

Banks also joined the party with YKB, Isbank and Akbank leading while Garanti was interestingly a laggard.

After the Fed’s hawkish minutes, all eyes will be on UST10s, especially with December CPI coming this Wednesday. Risk assets could see more volatility with real US interest rates rising as expectations for a faster and a bigger tightening is shaping up.

We expect TAV to continue its performance as the situation in Kazakhstan has calmed down. TOASO shares can face weakness due to a money magazine’s report on Koc Holding not accepting an offer by Stellantis to buy out all of Koc’s share in Tofas. The company declined to make any comments.

Macro news:

Weekly banking sector data: 13 week annualized loan growth declined to 17.4% from 18.2%, mainly due to deceleration was due to deceleration in commercial credits, while consumer credits continued to grow despite higher rates. The most eagerly watched banking sector is of course the trend in household foreign currency deposits, which increased US$0.6bn, while corporate FC deposits declined by US$2.7bn, most probably due to debt payments. The banking system deposit dollarization ended 2021 at 64%. The NPL ratio of the sector ended 2021 at 3.15% (down from 3.3% the previous week).

Company news:

*TOASO: Tofas made no comment on a money magazine’s report on Koc Holding not accepting an offer by Stellantis to buy out all of Koc’s share in Tofas. Tofas’ stellar rally in 2021 was partly due to the expectation on the announcement of a commercial EV model but also on rumors about Stellantis’ interest to buy out Tofas as it is the only JV operation it has globally. Tofas’ has always been an excellent asset for Fiat with excellent productivity and high quality

 *SAHOL TI> bought back 1,150K shares at an average price of TL14.61 on 07 Jan 2022. Since 09 Nov 2021, the total number of shares bought back reached 10.0mn at an average price of TL13.69.

 *ARCLK TI> bought back 117K shares at an average price of TL50.92 on 07 Jan 2022. Since 02 July 2021, the total number of shares bought back reached 36.7mn at an average price of TL33.47.

Weekly Agenda:

Dec 10: November Unemployment (October 11.2%)

Dec 11: November Current Account Balance (Consensus -US$2.5bn, October US$3.2bn)

Dec 13: November Industrial Production (Consensus +0.5% m/m, 8% y/y)