Global markets focus on PMI data

Despite the continued rise in technology companies operating in the semiconductor chip and artificial intelligence sectors, investors appear cautious ahead of US employment data to be released later this week.

Analysts stated that if the upcoming US employment data points to a softening in the country's labor market, expectations that the Fed could begin interest rate cuts in the first half of the year may increase.

Reminding that Fed Chair Jerome Powell's presentation to Congress tomorrow is in the focus of investors, analysts noted that the forward guidance of Fed officials is also being monitored.

Atlanta Fed President Raphael Bostic indicated that he needs to gain more confidence that inflation is falling before the policy interest rate is cut, stating that he expects two quarter-point interest rate cuts this year.

In money markets, while it is considered certain that the Fed will keep interest rates unchanged at its meeting on March 20, the probability of the bank making its first interest rate cut is priced at 22 percent for May and 65 percent for June.

Following these developments, the US 10-year bond yield finished the day with a 3 basis point increase at 4.22 percent, and is currently at 4.21 percent.

The ounce price of gold finished the day at 2,117 dollars with a 1.6 percent increase yesterday, marking its highest daily close of all time, and is finding buyers at 2,115 dollars at these moments.

The barrel price of Brent oil, which has been following a volatile course in the 80-85 dollar range for about the last month, is trading at 82.4 dollars today with a 0.3 percent decrease.

On the cryptocurrency market side, the price of Bitcoin exceeded 68,000 dollars with the continued interest in spot Bitcoin exchange-traded funds (ETFs), approaching its peak of 69,000 dollars seen on November 8, 2021.

On the other hand, the European Union (EU) fined the US firm Apple 1.8 billion euros on the grounds that it abused its dominant position in the distribution of music applications, and the company's share price finished the day with a 2.5 percent loss in value.

Yesterday on the New York Stock Exchange, the Nasdaq index recorded a 0.41 percent decrease, the S&P 500 index a 0.12 percent decrease, and the Dow Jones index a 0.25 percent decrease. Index futures in the US also started the new day with a negative trend.

In European stock markets, a negative trend prevailed yesterday except for France, while eyes today are turned to the Producer Price Index (PPI) data as well as the service sector and composite PMI to be announced across the region.

Analysts said that risk appetite in equity markets remains low ahead of the US employment report to be released this week, the European Central Bank's (ECB) interest rate decision, and the speech ECB President Christine Lagarde will make after the decision.

In Europe, which stands out as the region where the inflation and recession dilemma is most visible, the data to be announced today is expected to provide clues about the course of the regional economy.

On the other hand, European Union (EU) countries agreed yesterday to extend the practice of reducing natural gas consumption by 15 percent for 1 year to prepare for the coming winter period, while the Swiss National Bank (SNB) announced a loss of 3.2 billion Swiss francs (3.62 billion dollars) due to the transition to positive interest rates.

The ECB, the Deutsche Bundesbank, and the Dutch Central Bank (DNB) had also announced losses of 1.3 billion euros, 21.6 billion euros, and 3.5 billion euros, respectively, last year.

In addition, the German Economic Institute (IW) reported yesterday that Germany's Gross Domestic Product (GDP) could fall by 1.2 percent if former US President Donald Trump is re-elected.

Yesterday, the FTSE 100 index in the UK lost 0.55 percent, the DAX 40 index in Germany 0.11 percent, and the MIB 30 index in Italy 0.07 percent, while the CAC 40 index in France recorded a 0.28 percent increase. Index futures in Europe started the new day with a negative trend.

While a mixed trend stands out in Asian equity markets, the news flow from the Chinese Congress is in the focus of investors.

The simultaneous general assembly meetings of the legislative body, the National People's Congress of China (NPC), and the Chinese People's Political Consultative Conference (CPPCC), which functions as an advisory council, are of critical importance in terms of revealing the country's near-term economic strategy and goals, as well as its domestic politics and foreign policy priorities.

Analysts stated that expectations that the Chinese government will announce stimulus packages to support the economy are increasing, and that investors are acting cautiously ahead of the decisions to emerge from these meetings.

On the other hand, according to data released in Japan today, inflation occurring in line with expectations at 2.5 percent on an annual basis supported forecasts that the Bank of Japan (BoJ) is nearing the end of its negative interest rate policy.

While the service sector PMI in Japan exceeded expectations at 52.9, the Caixin service sector PMI in China remained below estimates at 52.5.

Near the close, the Nikkei 225 index in Japan rose 0.7 percent and the Shanghai composite index in China rose 0.1 percent, while the Kospi index in South Korea recorded a 0.6 percent decrease and the Hang Seng index in Hong Kong a 2.2 percent decrease.

In the domestic market, the BIST 100 index on Borsa Istanbul, which followed a selling trend yesterday, finished the day with a 2.08 percent loss in value at 8,907.65 points.

The Dollar/TL, after finishing the day at 31.5719, 0.6 percent above its previous close, following a buying trend yesterday, is trading at 31.6060 at the opening of the interbank market today.

On the other hand, Treasury and Finance Minister Mehmet Şimşek said in a TV program he attended yesterday, "There will be no general increase in VAT, corporate, or income tax rates. We have not even crossed our minds to make a new regulation regarding the motor vehicle tax."

Stating that they will not take any steps that would disturb the markets, Şimşek said, "As of now, there is no tax regulation on our agenda that would disrupt the market for the stock exchange or any other area."

Analysts stated that the real effective exchange rate in the country, and the service sector and composite PMI worldwide, as well as PPI in the Eurozone and factory orders in the US will be followed today, noting that from a technical perspective, the 8,800 and 8,700 levels are support, and 9,000 and 9,100 points are resistance for the BIST 100 index.

The data to be followed in the markets today are as follows:

11.55 Germany, February service sector and composite PMI

12.00 Eurozone, February service sector and composite PMI

12.30 UK, February service sector and composite PMI

13.00 Eurozone, January PPI

14.30 Turkey, February real effective exchange rate

17.45 US, February service sector and composite PMI

18.00 US, January factory orders