Following the continued slowdown in inflation in the USA, the above-seasonal temperatures in Europe and the decline in natural gas prices maintain the optimism that price pressures will continue to ease.
On the other hand, European officials’ statements that a recession is likely to be prevented and China’s lifting of epidemic measures bring about alleviation of concerns about global economic growth.
While these developments kept the risk appetite alive, it is seen that the new day started with a mixed course in index futures contracts and Asian stock markets, with the data released today in China.
The indices in the New York stock market, which was closed for trading yesterday due to the holiday, followed a positive course on Friday and completed the day with an average increase of 0.5 percent. Today, while the leading US banks Goldman Sachs and Morgan Stanley are expected to announce their fourth quarter financial results, the dollar index is trading at 102.4 with an increase of 0.2 percent. The US 10-year bond yield rose to 3.54 percent, ending the downward trend observed since December 30. Index futures contracts in the USA started the new day with a decline.
On the European side, natural gas futures prices traded in the Netherlands fell 15.3 percent to below 55 euros, hitting a 16-month low. In his speech at the World Economic Forum held in Davos, Eurogroup President Paschal Donohoe said that the economy is at a significant level of resistance and that a recession can be prevented. Following these developments, the expectation that the European Central Bank (ECB) might start interest rate cuts after the completion of the first half of the year came to the fore.
Since the beginning of the year, the optimistic mood in the European stock markets continued yesterday and the FTSE 100 index in the UK increased by 0.20 percent and approached its historical peak. In Germany, the DAX 40 index gained 0.31 percent and in France, the CAC 40 index gained 0.28 percent. The euro/dollar parity is trading at 1.0830 with an increase of 0.1 percent. A mixed trend is observed in index futures contracts in Europe.
According to data released today on the Asian side, the Chinese economy recorded 3 percent annual growth in 2022, the second-lowest annual growth rate since 1976, below the government target of approximately 5.5 percent. Industrial production in the country increased by 1.3 percent year-on-year in December, exceeding expectations, while retail sales fell less than forecast by 1.8 percent in the same period.
In China, which recorded the weakest growth in the last 46 years when 2020 is excluded, better-than-expected retail sales and industrial production data and the removal of Kovid-19 restrictions in the country caused the mixed picture of the economic outlook to continue. It is stated that the size of the incentives and liquidity supports expected to be provided by the government this year will be important, and that investors need more data in terms of shaping their expectations for the future period, while raising questions about how the profitability levels will be affected while the businesses are struggling with the increasing epidemic wave.
On the Japanese side, the decisions that will come out of the monetary policy meeting of the Bank of Japan (BoJ), which started today, are in the focus of investors. While it is eagerly awaited whether the Bank will take further action regarding the yield curve, it is unlikely that it will change its ultra-loose monetary policy.
With these developments, the Nikkei 225 index in Japan increased by 1.3 percent and the Sensex index in India by 0.6 percent, while the Shanghai composite index in China decreased by 0.3 percent and the Hang Seng index in Hong Kong decreased by 1.2 percent.
Moving in an upward trend in the domestic market yesterday, the BIST 100 index gained 4.47 percent and closed the day at 5,207.67 points. Dollar/TL is trading at 18.7960 at the opening of the interbank market today, after completing the day with 18.7875 yesterday, just above the previous closing level.
Analysts said that despite the improvement in inflation expectations in global equity markets, the cautious approach to economic growth was maintained and a mixed course was followed.
Stating that the news flow from the Davos Summit continues to remain in the focus of investors, analysts stated that domestic sales, New York Fed industrial index in the USA, unemployment rate in England and inflation in Germany came to the fore on the data agenda.
Analysts stated that technically, the levels of 5.250 and 5.340 in the BIST 100 index are in the resistance position and 5.100 points are in the support position.
The data to be followed in the markets today are as follows:
10.00 Turkey, house sales in December
10.00 UK unemployment rate for November
10.00 Germany, December Consumer Price Index
13.00 Germany, January ZEW economic confidence index
14.30 Turkey, November house price index
16.30 US, January New York Fed industrial index