Although the increase in the number of new cases in the new type of coronavirus (Covid-19) epidemic lost momentum and expectations that countries would begin to loosen restrictions had a positive impact on the markets, concerns about economic activity continued with the data announced last week.
While the manufacturing and service sector Purchasing Managers Index (PMI) data published last week indicate that the contraction in the global economy continues, this week’s data agenda highlights the first quarter growth data of the USA on Wednesday and the Euro Zone on Thursday.
In addition to the growth data, this week, the decisions of the US Federal Reserve (Fed) on Wednesday and the European Central Bank (ECB) on Thursday will also have an impact on the direction of the markets. The Bank of Japan (BoJ) further loosened its monetary policy with the decisions announced today. BoJ, which removed the limit on the government bond purchasing program, also increased the corporate bond purchasing limit to 20 trillion yen.
Central banks are not expected to change interest rates
While central banks are not expected to change interest rates this week to see the impact of governments’ supportive financial policies, it is estimated that the ECB may also increase its bond purchasing program.
In the stock market, which rose on the last trading day of last week with the support of the recovery in oil prices in the USA, the Dow Jones index gained 1.11 percent, the S&P 500 index gained 1.39 percent and the Nasdaq index gained 1.65 percent.
A negative trend was observed in the European stock markets, which closed before the buying strengthened in the US stock markets. DAX index in Germany decreased by 1.69 percent, FTSE 100 index in England decreased by 1.28 percent and CAC 40 index in France decreased by 1.30 percent.
Asian markets started the new week positively with the supportive steps of the BoJ, after last week’s volatile course. After the BoJ lifted the limit on its bond purchasing program, the Nikkei 225 index near the closing gained 2.7 percent, the Shanghai composite index in China gained 0.6 percent and the Kospi index in South Korea gained 1.9 percent.
Brent oil is trading at $21
The barrel price of Brent oil, which fluctuated sharply between 15-28 dollars last week, is trading at 21 dollars with a decrease of approximately 3 percent at the opening of the new week.
Domestically, the BIST 100 index, which gained 0.60 percent in value on Friday, completed the week at 98,758.96 points. Thus, the BIST 100 index increased by 0.59 percent compared to the previous week, bringing its upward trend to the 5th consecutive week. Dollar/TL, which increased by 0.6 percent on a weekly basis and closed at 6.9730, is traded at 6.9630 at the opening of the interbank market today.
Analysts stated that the data calendar will become more active around the world as of tomorrow, and that company balance sheets to be announced domestically may also cause an increase in sector- and stock-based movements.
Stating that the news flow regarding the Covid-19 epidemic and the measures taken remains at the center of the agenda, analysts reported that the decisions and statements to be made from the meetings of the central banks of developed countries will be decisive on the direction of the markets.
Analysts noted that technically, if the BIST 100 index remains above 99,000, the 106,000 level may come to the fore, while the 6.95-7.00 band will be followed in the dollar/TL.
The data to follow in the markets today are as follows:
17.30 USA, Dallas Fed manufacturing index
Source: https://www.aa.com.tr/tr/ekonomi/kuresel-piyasalar-merkez-bankalarini-bekleyen/1819540
