Page 15 - TURKRptOct20

As institutional foreign investors have been selling Turkish stocks at whatever price they can fetch, fundamental analysis is not needed here. And the invisible hand who keeps the benchmark index at above 1,000 and the individual investors are definitely not in the market for any kind of analysis, fundamental, technical, or whatever.
The ratios of the Borsa Istanbul suggest it is really cheap, just as they have been suggesting for a few years. The market, it is true, has gotten cheaper, led by a one-time flagship banking industry. If you’re not au fait with the troubles of Turkey’s banks, suffice to say, please keep away from cheap cheese.
There is talk that local institutional investors look for trading boards that are clear of foreign players. The reason remains the same. The foreigners have simply been selling. Different from individual investors, local institutional investors are also in a position to keep away from the speculative boards. So, as a trading idea, though with little prospect of adrenaline, if you think you will perish if you don’t urgently buy some Turkish stocks, look out for trading boards where the local institutional investors are building up. But beware, they may run away if they see some foreigners on the trading board :=)).
The Borsa Istanbul, established in 1985, is a large economic habitat. It has many stakeholders, including many domestic and foreign brokerage houses.
The brokerage houses produce many multiples of research reports for the market. So the stock exchange’s stakeholders are existentially in a position to act as if this is a real equities market. At the same time, it is currently not possible to rationally advise “Take profit” or “Sell short” at the moment, leaving the only option as “Buy”.
Although this column will not advise engaging in the Borsa Istanbul before the USD/TRY spiral takes a breather, we will provide those readers and subscribers, who cannot live without trading Turkish equities, with some real information in the upcoming period.
Non-resident investors sold a net $30mn of Borsa Istanbul equities in the week ending September 11, following their sale of $92mn worth in the previous week, Turkish central bank data ​showed​ on September 17.
Foreign investors—in reality either foreigners or Turks, but in any case institutional investors able to move stock prices—were for almost two decades the dominant players who determined the direction of the Istanbul stock exchange. Simple trading ideas were in play, such as buying stocks sold by the foreign investors from dips and awaiting the return to the market of these investors in order to sell the shares back to them.
However, more or less since the start of this year, these cycles no longer function the way they did. The foreigners, including “long-termers”, have been constantly selling and exiting—and it is unknown at the moment when the day will come that they will return to buy.
The Turkish government sees life as simple. It believes that governing a country, or an economy, is only about governing perceptions.
This perspective is supported by another bold assumption, namely that everyone is a fool and ready to be steered in a convenient direction.
Such a way of seeing life makes the government unable to see that some people simply play the fool as long as they gain some benefits from doing so.
The government is unfortunately still not aware that even pure ignorant (as it sees them) Turks (whom it thinks it can fool by ​saying​, “What is your business
15​ TURKEY Country Report​ October 2020 ​ ​www.intellinews.com