The number of domestic investors in Borsa Istanbul is expected to reach 2 million by the end of June. It was also the source of the rise in Borsa Istanbul, where the share of domestic and foreign investors, whose 1.5 million limit was exceeded in May, dropped to 51 percent. BIST TUM index, which includes 232 stocks in Borsa Istanbul since March 19, has achieved the best performance with a 90 percent increase. In the same period, BIST100 index managed to increase by 35 percent. The biggest reason why domestic investors turned to the stock market was negative real interest income.
Türkiye ranks third among countries that give negative interest rates. The first is Venezuela, whose policy rate is 39.78 percent against an inflation rate of 2296.6 percent. Venezuela’s interest rate inflation difference is 2256.82 points. Second is Argentina, which has a policy rate of 38 percent despite an inflation rate of 42.1 percent. The interest rate inflation difference in Argentina is 4.10 points. While inflation in Turkey is 11.39 percent, the policy rate is 8.25 percent and the inflation-interest difference is 3.14 points. The interest rate inflation difference is determined as 3 points in Iran, 2.80 points in Poland, 2.30 points in Chile, 1.95 points in Australia, 1.84 points in India and 1.30 points in Norway.
Foreign ratio decreased to 51.8 percent
In addition, on March 17, the foreign share in the stock market was at 60.5 percent, while the BIST 100 index was around 81 thousand 936 points. Currently, the BIST 100 index is over 115 thousand points and the foreign ratio is at 51.8 percent. This difference reveals how effective domestic investors are in the stock market.
While analysts point out that the stock market performed well during the pandemic period, primarily with the contribution of locals, they point out that such a decline in the share of foreigners is not sustainable in countries such as Turkey, which need external financing. Analysts emphasize that it is positive that foreigners’ net buyer position of stocks, which has been going on for two weeks, is positive, and note that Borsa Istanbul and brokerage firms, especially the Capital Markets Board, should work together to inform domestic investors, whose number is expected to approach 2 million.
Source: https://www.dunya.com/finans/haberler/negatif-reel-faizde-ucuncuyuz-haberi-473910
