Negative news flow regarding the US debt limit crisis remains the main risk factor for asset prices.
While the White House and Republican representatives met again yesterday for debt limit negotiations, US House of Representatives Speaker Kevin McCarthy pointed out the disagreements over spending, stating that the negotiators are still far from some issues, at a press conference.
Expressing his hope that progress will be made in the negotiations, McCarthy expressed that a debt limit agreement could be reached and that they told US President Joe Biden that they would not increase taxes and that they made many concessions in the negotiations.
US Treasury Secretary Janet Yellen also reiterated her warnings that the debt limit should be raised, saying she believes a deal is possible to avoid default.
International credit rating agency Fitch Ratings put the US’s “AAA” credit rating on negative watch due to the debt limit dilemma.
On the other hand, the minutes of the Federal Open Market Committee (FOMC) meeting held on May 2-3, published by the US Federal Reserve (Fed), revealed that some Fed officials may need more interest rate hikes, while others disagree.
Index contracts in the USA started the day with mixed movement
While the Fed authorities continue to guide them verbally, Fed Board Member Christopher Waller noted that whether or not to raise interest rates at the June meeting will depend on the data for the next three weeks.
Waller said that prudent risk management may require an increase in July based on the inflation data received at the June meeting.
Emphasizing that he does not support stopping interest rate hikes unless there is clear evidence that inflation is moving towards the 2 percent target, Waller expressed his concern at the lack of progress in inflation.
After these developments, the pricing in the money markets that the Fed could raise interest rates by 25 basis points in June rose to 34 percent.
Analysts noted that the signals received from macroeconomic data remain important in the shadow of the debt limit dilemma and said that the data to be announced today, especially the growth in the USA, may increase the volatility in asset prices.
On the other hand, upon the understanding that the artificial intelligence chips of Nvidia, which announced its financial results yesterday in the USA, strongly supported the sales volume of the company, the company’s stock futures contract rose by close to 25 percent in the futures markets, while the Nasdaq futures contract was over 1 percent. looks premium.
Yesterday, the S&P 500 index fell by 0.73 percent, the Nasdaq index by 0.61 percent and the Dow Jones index by 0.77 percent in the New York stock market. Index futures contracts in the USA started the new day with mixed movements.
While a sales-weighted course stood out in Europe yesterday, the growth data to be announced in Germany today has placed the focus of investors.
While the members of the European Central Bank (ECB) continue to guide them by saying that they should continue to increase interest rates as part of the fight against inflation, yesterday ECB member Bostjan Vasle stated that the ECB has to continue to increase interest rates, but the next month’s rate hike may be lower than the previous one.
Yesterday, the DAX 40 index in Germany fell by 1.92 percent, the CAC 40 index in France by 1.7 percent, the MIB 30 index in Italy by 2.39 and the FTSE 100 index in the UK by 1.75 percent. Index futures contracts in Europe started the new day with a limited rise.
Asian stock markets followed a mixed course in the new day, while technology stocks across the region limited the downward trend.
While the Nikkei 225 index increased by 0.4 percent in Japan near the closing, the Hang Seng index in Hong Kong decreased by 2.5 percent, the Shanghai composite index in China decreased by 0.9 percent and the Kospi index in South Korea decreased by 0.3 percent.
Interest rate expected to remain constant
While the BIST 100 index in Borsa Istanbul, which followed a sales-weighted course in the domestic market yesterday, finished the day at 4,424.92 points, 1.03% below the previous close, today the eyes were turned to the CBRT’s interest rate decision.
Economists expect the policy rate to remain constant at 8.50%.
Dollar/TL is trading at 19.9060 at the opening of the interbank market today, after closing at 19.9004 with an increase of 0.2 percent yesterday.
Analysts stated that the news flow regarding the US debt limit crisis will be followed today, along with weekly money and bank statistics in the country, as well as the intense data agenda, especially growth in the USA and Germany abroad, and technically, the BIST 100 index will reach the levels of 4,400 and 4,200. He noted support, 4,500 and 4,600 points as resistance.
