Global Securities (GMD) 2024 Turkiye Strategy Report has been published.
According to the report prepared by the GMD Research Department, interest in Borsa Istanbul is expected to remain strong despite factors such as a possible slowdown in growth in the short term and a tendency towards interest-bearing instruments.
It is estimated that in the first half of the year, companies and sectors that benefit from increasing interest rates and stable TL, resilient sector stocks (banking, insurance sectors) that have lower financing needs and can offer real growth, and certain companies that benefit from incentives for exporters and technology-oriented sectors may show more positive performance (retail, telecom).
DISINFLATION WILL START IN JULY
The report also included an inflation forecast for 2024. It was stated that inflation, which is expected to rise until May 2024, will remain balanced in June, and then a rapid disinflation process will begin. It was envisaged that 2024 would be completed with “an interest rate of 45.5%”.
It was stated that the Turkish economy is expected to close the year with 4% growth, with the impact of interest rate cuts expected towards the end of the year.
THERE IS AN EXPECTATION OF A 150 BASIS POINT INTEREST INCREASE IN JANUARY
In the monetary policy shaped in line with the inflation path, it was predicted that the policy interest rate could increase to 44% with an increase of 150 basis points in the Monetary Policy Committee (MPC) in January. The report stated that the policy rate will be kept constant in the following period and made the following evaluations:
“We foresee that it will be reduced to 40% by the end of 2024, with gradual reductions to be made in parallel with the improvement in inflation after October. Additionally, as a reminder, rating increases by foreign credit rating agencies will cause a positive deviation in all forecasts. Looking at the calendar, the first assessment of the year came with Moody’s on January 12. While the credit rating was maintained at B3, the outlook was upgraded from stable to positive. Moody’s will re-evaluate on July 19. We estimate that Turkiye’s credit rating will be gradually increased to investment grade levels in the rating evaluations that will continue with Fitch on March 8 and September 6 and with S&P on May 3 and December 6.”
In the report, it was stated that the main metal industry stocks, which have performed below expectations in the last two years, may gain strength again, depending on the gradual acceleration of economic activity with the expectations for interest rate cuts that may occur domestically and abroad as of the second half of 2024.
55% RETURN EXPECTATION WAS ESTIMATED IN BIST100
The share portfolio included in the report included “TSKB, ISCTR, KRDMD, BIMAS and TTKOM”.
While 11 thousand 600 points were stated for the year-end target in the BIST100 index, it was stated that the return of the index in 2024 is expected to be around 55%.
In the report, “Taking into account the macro outlook and global conjuncture, we think that stocks with lower growth sensitivity, which may be resistant to increases in interest rates, which have an investment theme and attractive multipliers will come to the fore in the first half of the year, and we find it appropriate to create a balanced portfolio in a long-term perspective. We think that there has been a significant improvement in operational conditions in the banking sector in parallel with the steps of the new economic management, and we prefer to keep our bank weight high in the portfolio.”
Source: Patronlardunyasi / Prepared by Irem Yildiz