Global markets remain positive

Uncertainties in the markets decreased, albeit to a limited extent, with the pricing of the US Federal Reserve’s (Fed) monetary policy steps to a large extent.

According to the macroeconomic data released in the country yesterday, durable goods orders fell by 4.5 percent on a monthly basis in January, falling below the forecasts, while pending home sales recorded the strongest increase since June 2020 with 8.1 percent.

Analysts noted that with the data on economic activity, the possibility of a soft landing came to the fore again and this supported the markets.

Interest rate hike is taken for granted

Analysts stated that it is considered certain that the Fed will increase interest rates by 75 basis points in the pricing in the money markets, and reminded that the increases are expected to be made in the form of 25 basis points at the meetings in March, May and June.

While Fed officials continued their verbal guidance on monetary policy, Fed member Philip Jefferson defended the bank’s 2 percent inflation target. Expressing that changing the inflation target may negatively affect expectations, Jefferson said that if prices in the service sector ease, there may be a softening in wages in this sector.

Positive outlook in Europe

Although the US 10-year bond yield reached the highest level since November 10, 2022 with 3.98 percent yesterday, it could not hold at these levels and closed the day at 3.92 percent.

With these developments, the S&P 500 rose 0.31 percent in the New York stock market, the Dow Jones index rose 0.22 percent and the Nasdaq index rose 0.63 percent. Index futures contracts in the USA started the new day with a rise.

While a positive trend emerged on the European side yesterday, the concerns that the European Central Bank (ECB) may continue to increase interest rates until 2024 are getting stronger.

While the selling pressure on the bonds of the countries in the region increased with the pricing in the money markets that the ECB could reduce the policy rate to 3.8 percent by the end of the year, Germany’s 10-year bond yield rose to 2.58 percent, the highest of the last 12 years.

Continuing his verbal guidance yesterday, ECB member Boris Vujcic stated that the bank should not give up on its hawkish policies as long as core inflation remains strong.

The DAX 40 index in Germany rose 1.13 percent, the FTSE 100 index in the UK rose 0.72 percent, the CAC 40 index in France rose 1.51 percent and the MIB 30 index in Italy rose 1.70 percent. Index futures contracts in Europe started the new day with a mixed movement.

Today, Asian stock markets follow a mixed course, while expectations that the Chinese government will continue to support the economy limit the declines.

According to the macroeconomic data released in the region today, industrial production in Japan decreased by 4.6 percent on a monthly basis, displaying its worst performance in the last 8 months.

Retail sales in the country, on the other hand, surpassed expectations with an increase of 1.9 percent. On the other hand, the obligation to use masks in Hong Kong has been lifted.

With these developments, the Nikkei 225 index in Japan and the Shanghai composite index in China remained flat, while the Hang Seng index in Hong Kong fell by 0.4 percent. In South Korea, the Kospi index gained 0.2 percent.

Uptrend in BIST

Domestically, the BIST 100 index, which was in an upward trend yesterday, closed the day at 5,197.44 points, 2.74 percent above the previous close.

Dollar/TL, on the other hand, is trading at 18.8860 at the opening of the interbank market today, after closing at 18.8875 with a horizontal course.

Analysts stated that today, the intense data agenda will be followed, especially the 4th quarter Gross Domestic Product (GDP) in the domestic market, and the wholesale stocks in the USA and the housing price index abroad, and technically, the levels of 5.250 and 5.340 in the BIST 100 index will show resistance, He noted that 5,150 and 5,100 points are in support position.

Economists participating in the expectations survey of AA Finans predict that GDP increased by 2.8 percent in the 4th quarter of last year.