Global market strength props up Turkish assets
ISTANBUL (Reuters) – Turkish assets recovered yesterday after losses at the end of last week, profiting from renewed global optimism that banks’ credit woes might be past the worst, which drove world stocks to a fresh one-month high. Turkey’s main stock index gained 2.21 percent to close at 42,277.15, while the lira firmed slightly to 1.2800 to the dollar from Friday’s interbank market close of 1.2850. Speculation that finance chiefs from the Group of Seven rich nations, meeting in Washington this weekend, will consider drastic steps to fix banks and markets battered by the US mortgage meltdown lifted investor mood in markets across Europe and the United States. «Turkish markets are following international markets at this juncture, despite negative macro and political news flow,» said Ali Riza Incekara, head of research at Raymond James in Istanbul. Higher-than-expected inflation data last week doused hopes of further rate cuts and rating agency Standard and Poor’s lowered its outlook on Turkey’s credit rating to negative, citing an increasingly fraught political and global environment. «Over the past week the (stock) market has risen by almost 12 percent, but going forward it is a question of whether the Justice and Development Party can save itself,» Incekara added. «We could see this rally last to around 44,000 to 45,000 points but that is the upside,» he said.