COVID-19 cases are increasing and vaccination has literally failed in the country. But at the full side of the glass, the pandemic had a positive impact on the stock exchange while it has considerably affected other economic activities in an adverse manner. The pandemic has directed domestic investors to Borsa Istanbul (BIST) and 1,000,000 new domestic investors have penetrated the equity market. Interest of domestic investors has tended towards in the new entries in the stock exchange resulting in 494% increase in initial public offering (IPO) index in the last year.
Interest of domestic investors has created a record demand, especially in IPOs. Companies which aren’t traded at BIST have accelerated their IPO processes on one hand, the equities of these newly offered companies have astonished on the other. Early-bird price of Kontrolmatik’s share offered to the public in October 2020 stood at TRY 7.59, which have reached TRY 93 at the moment, indicating a 1,125% of increase. Moreover, equities successively reach the maximum prices. While analysts respond positively the high interest in IPOs, they also warn investors be careful about the volatility in prices. Hopefully, this ambition will bound foreign investors, who made net sales of USD 253.8m in February.
Meanwhile, BIST performed all-time high closing by 1,570 points yesterday, after it rallied following the EUR 2bn worth investment news by Ford Otosan. The positive outlook is expected to continue at BIST’s equity market if the easy course continues in foreign exchange (FX) rates.
Considering FX rates, USD/TRY is balanced between 7.48-7.49 prior to the Central Bank’s interest decision. EUR/TRY is traded at 8.92.
Maintaining the upward trend before Fed’s interest decision and Fed Chair Powell’s messages, spot gold is traded at USD 1,736 per ounce. Brent crude exceeds USD 68 per barrel.
The Central Bank released short term external debt statistics. Accordingly, short-term external debt stock increased by 1.3% to USD 140.3bn in January, compared to December 2020.