Turkish markets end flat, weighed down by political uncertainties
ISTANBUL (Reuters) – Turkish markets ended largely flat yesterday as a holiday in the United States dampened trading and growing risk aversion made investors wary of increased political uncertainty in Turkey. The lira was slightly weaker at 1.5000 against the dollar, versus Friday’s close of 1.4905. The yield on the new August 13, 2008 benchmark bond rose to 21.95 percent from the previous 21.84 percent. Istanbul’s main stock index rose 0.4 percent to 36,885.89 points. «We are entering a period when money inflows will be more difficult. Investors do not want to enter as they do not want to take risks because of presidential and parliamentary elections,» said Ata Investment Partnership’s Osman Buyukgoksu. Turkey’s Parliament will choose a new president in May and voters will elect a new assembly by November 2007 at the latest. Critics have accused the ruling Justice and Development Party (AKP), which has Islamist roots, of endangering the country’s secular political order. But Buyukgoksu said there was no big reason at present to sell and this kept the share index trading in a narrow band. Some analysts also worry that Turkey’s European Union bid could be hurt by a French bill to make it a crime to deny that Armenians suffered genocide at the hands of Ottoman Turks during World War I. The French Parliament is due to debate the bill on October 12. Turkish officials have warned of serious damage to bilateral economic and political ties if the bill is approved. Turkey’s trade with EU heavyweight France is worth around $10 billion a year and French companies such as Renault and Carrefour have large investments in Turkey. Another key focus for Turkish markets this week will be a visit to Turkey by the International Monetary Fund for the fifth review of the country’s $10 billion loan program. The loans package helped Turkey to recover from a 2001 financial crisis.
