Turkish stocks plunged into negative territory last week despite getting a lift from a joint intervention by U.S., European and Japanese central banks trying to bail out the beleaguered euro.
The Istanbul Stock Exchange's main-100 index closed Friday at 11,100 points, down 1.95 percent from Thursday. Stocks opened lower in the morning amid the plunge in global markets prompted by a heavy sell off in high-tech shares. The main index plummeted 3.65 percent by the end of the first session on thin trading, brokers said.
The sell-off in high-tech shares came after a warning by semiconductor giant Intel that profits would be lower in the third quarter because of feeble demand for microprocessors in Europe. Turkey's leading mobile operator, Turkcell, which is listed on the New York Stock Exchange, also took a beating from the tech sell-off on Wall Street.
"We knew it would be a bad day, because Turkcell would go down, which it did," said Can Yazgan, a trader with brokerage Ata Securities.
Turkcell shares ended 12 percent down at TL 29,000. Since their launch at TL 44,000 in July they have gone down around 35 percent.
"We can't feel optimistic about the near future of the stock market. If it were not for the euro intervention the index could have dropped toward year lows," said Emre Balkeser of Alfa Securities.
Since its historic peak in January, the IMKB has lost more than half of its gains.
"High overnight rates are pressuring the market as well as bond yields that have climbed to 39.5-40 percent," Balkeser said.
Political uncertainties are also casting a shadow on the Turkish equity market.
``The closure case against the Virtue Party (FP) has been there and will continue to deter an upward movement until its conclusion in October," Ata Securities' Yazgan said.
The FP is facing a closure case at the Constitutional Court, which markets fear might lead to an early election.
"But Turkish stocks would be eyeing global markets which have been unsettled by decade high oil prices," Yazgan added. – (Albawaba-MEBG)
© 2000 Mena Report (www.menareport.com)
