The Turkish markets currencies, bonds and equities are in vogue Monday morning in Europe, after a new election in Istanbul, the largest city and commercial center of the country, which resulted in a great defeat of the ruling party of president Recep Tayyip Erdogan.
At 10.45 am, the lira had gained more than 1.4% against the dollar to reach a peak of five weeks 5,7060. The performance of the benchmark index of the government of the obligation to 10 years of age decreased from 16.08 per cent, while the benchmark stock has reached its highest level since April, with a rise of 1.8%.
The play had already started to make gains on Sunday after the results of the elections, but the movement was accentuated after the party of Erdogan has officially acknowledged its defeat, thus eliminating the fears that it uses its power to stifle the democratic process. Such a reaction would have led to more trouble for the assets of the turks, which fell this year under the efforts unorthodox of the government to control the debt crisis now raging in the country’s banks.
“It’s the best of scenarios,” said Paul McNamara, portfolio manager at GAM, an asset manager based in Zurich. “This makes it less likely the stimulus of emergency or monetary intervention, what Turkey can afford that. “
McNamara emphasized the importance of the acceptance of the defeat by Erdogan and the AKP.
“We avoid the protests that have followed many attempts at reversal (the result of the vote and) the government maintains its legitimacy”, he said.
All this is in sharp contrast with the european markets more developed, which were mostly lower following a further investigation dismal the think tank Ifo index very follow-up on the business climate in Germany remained stuck at its lowest level in over seven years. While businesses have reported a slight improvement in current conditions, their expectations were clouded once more.
The German index Dax was the worst performer in Europe, losing 0.4%, while the ratio of Ifo weighed on a market already affected by another warning on profits of the parent company of Mercedes-Benz cars, Daimler (DE: DAIGn). The company has issued its third warning on profits in less than a year on Sunday evening, acknowledging the additional costs related to the scandal of diesel emissions.
The benchmark Euro Stoxx 600 index was down 0.1%, while the index british FTSE 100 was up 0.1%.