Iraq call hits Turk bourse

ISTANBUL (Reuters) – Turkish markets eased yesterday after the head of the armed forces said Turkey should launch a military operation against Kurdish separatist militants in neighboring northern Iraq. The lira weakened to 1.3790 against the dollar in after-hours interbank trade after closing at 1.3775. It had traded at 1.3740 before the Iraq comments. The lira ended at 1.3720 on Wednesday. General Yasar Buyukanit called in a rare news conference for a military operation in northern Iraq to quash Turkish Kurdish rebels hiding there, but added a political decision from the government was first required for such a step. «(This is) obviously a negative, and a rather disturbing, turn of affairs, which will need some reaction from the US,» Simon Quijano-Evans, economist at Unicredit, said in a note. Ankara says thousands of Kurdistan Workers’ Party (PKK) militants – fighting for a homeland since 1984 – use northern Iraq as a base from which to plan attacks in Turkey. The general’s comments also caused weakness on the Eurobond market as yields rose to 7.062 percent, from the previous day’s close of 7.051 percent. «The market weakness is largely on the back of the chief of staff’s statement because it puts the government in a tight corner in an election year,» said Mehmet Simsek, emerging market strategist at Merril Lynch. «The government has so far been pragmatic, avoiding a direct military intervention in northern Iraq despite public pressure to do so,» he said. The main Istanbul share index extended losses to stand 1.17 percent lower at 45,566.09 points. A German-Turkish partnership between Fraport and IC Holding won a tender to operate and expand the airport of tourist hub Antalya with a bid of $3.196 billion, well above an estimated value of between $2.5 billion and $2.7 billion. Shares in airport services firm Celebi fell by as much as as 5.5 percent after website reported it had been eliminated from the tender.

Subscribe to our Newsletters

Enter your information below to receive our weekly newsletters with the latest insights, opinion pieces and current events straight to your inbox.

By signing up you are agreeing to our Terms of Service and Privacy Policy.