Turkish Lira: Liquidity Challenges Ahead
Declining volumes in currency trading has been an overriding theme as banks have been subject to stricter regulations on their trading activities. It is early to talk about the recent Trumpflation trade has caused any change globally, but when it comes to trading Turkish lira we still see that shrinking volume is an underlying trend.
Below we present the chart that shows total annual TRY trading volumes in form of forwards, spot trading and swaps.
Turkish Stocks: Banks v Industrials
One of the key market themes that marked this year has been the bank stocks trading with low multiples and the advancement in the industrials. Time and time again we uttered that the golden age of Turkish banking is over (see here and here) which was finally embraced by a top banker in Turkey. Given the banks capturing a dominant share of the Turkish stock market the BIST 100 index has expectedly performed poorly.
We...
Profound Shift In Liquidity Risk
On Sep 15 an article appeared on Bloomberg that drew a gloomy picture for the brokerage services industry in Turkey. Some important highlights from the article are as follow:
About one third of brokerages posted losses in the first quarter. Austria-based Erste and Kuwait-based Burgan are eliminating jobs while Moscow’s Renaissance Capital is planning to shut its Istanbul office. Thirty-three analysts rate Halkbank (BIST:HALKB), one more than those who rate Goldman Sachs. The Borsa Istanbul 100 Index has fallen 15 percent this...