Sell-off pressure emerges in bond markets following Thanksgiving holiday

While the news flow from the Middle East continues to positively impact asset prices, a humanitarian pause has begun following an agreement between Hamas and Israel, which will halt attacks on Gaza for 4 days and allow for a prisoner exchange and the delivery of humanitarian aid.

While uncertainties regarding whether the agreement between Hamas and Israel will be extended are expected to impact oil prices, it is noteworthy that volatility in the price of Brent crude oil has decreased due to the holiday effect. Predictions of weakening demand in the US have also contributed to the decline in oil prices, and after a two-day retreat, the barrel price of Brent crude is trading sideways at 81.3 dollars on the new day.

Volatility has increased in US bond markets after 5 trading days, with the US 10-year Treasury yield rising by approximately 5 basis points to 4.46 percent on the new day.

As many employees in the US have combined the Thanksgiving holiday with the weekend, market volume is expected to remain low today, and the New York Stock Exchange will have a half-day session. Furthermore, investors are closely monitoring the strength of demand during the shopping season in the US, which begins this week with Black Friday.

The price of gold per ounce is also searching for direction and is currently finding buyers at 1,994 dollars in sideways trading.

While European stock markets followed a limited buying-weighted trend yesterday, eyes are turned today to the statements of European Central Bank (ECB) President Christine Lagarde.

The minutes of the ECB's October monetary policy meeting revealed that members of the ECB Governing Council are more concerned about economic growth.

The minutes, which include the assessments of the council members, showed that members insisted that further interest rate hikes should be kept on the table, even if further tightening is not the main scenario.

Purchasing Managers' Index (PMI) data for the manufacturing and service sectors released in the region showed that while economic activity continues to slow across the region, the pace of the slowdown is decreasing.

The DAX 40 index in Germany rose by 0.23 percent, the CAC 40 index in France by 0.24 percent, the MIB 30 index in Italy by 0.28 percent, and the FTSE 100 index in the UK by 0.19 percent. Index futures in Europe started the new day with a mixed trend.

Asian markets followed a mixed trend on the new day, and steps taken by the government in China that could support distressed companies, particularly in the real estate sector, are not helping to reduce risk perception.

Inflation data released in Japan raised the possibility that the Bank of Japan (BoJ) might further delay its normalization calendar, while the Consumer Price Index (CPI) in the country remained below expectations with a 3.3 percent annual increase.

Near the close, the Nikkei 225 index in Japan rose by 0.6 percent, while the Hang Seng index in Hong Kong fell by 1.4 percent, and the Shanghai composite index in China and the Kospi index in South Korea fell by 0.7 percent.

Domestically, the BIST 100 index at Borsa Istanbul, which followed a selling-weighted trend yesterday, completed the day with a 1.1 percent loss at 7,898.59 points, while the Central Bank of the Republic of Turkey (TCMB) raised its policy rate by 500 basis points to 40 percent.

In the statement made by the TCMB, it was noted that the Board assessed that the level of monetary tightness required to establish disinflation has been significantly approached, and it was reported that the pace of monetary tightening will be slowed and the tightening steps will be completed in a short period of time.

In other announcements made by the TCMB, it was stated that there would be no changes to maximum credit card interest rates and merchant commission rates until the end of the year, and an upper limit was imposed on the total interest cost for rediscount credits for exports and foreign exchange-earning services.

The total reserves of the TCMB increased by 5 billion 854 million dollars in the week of November 17 compared to the previous week, reaching 134 billion 468 million dollars, the highest level in the last 9 years.

The Dollar/TL exchange rate, after closing the day at 28.8274 with a 0.1 percent decrease yesterday, is trading at 28.8800 at the opening of the interbank market today.

Analysts stated that the real sector confidence index and capacity utilization rate will be followed domestically today, while ECB President Lagarde's speech, growth data in Germany, and manufacturing, service sector, and composite PMI data in the US will be monitored abroad, noting that from a technical perspective, the 7,850 and 7,800 levels are support, and 8,000 and 8,060 points are resistance for the BIST 100 index.

News Source: 12punto