Turkey’s CDS rises to eight-month high amid anti-government protests, BIST-100 slumps.

By bne IntelliNews June 6, 2013

The anti-government protests continued on Wednesday despite an apology from Deputy PM Bulent Arinc for the violent police crackdown on initial protests last week.

The benchmark Bourse Istanbul 100 index was down 1.4% d/d on Wednesday closing at 76,637 after it recovered slightly on Tuesday. On Monday the index slumped 10.5%, one of the biggest daily decline in a decade. Two-year government bond yields remained almost flat at 6.24% from Tuesday’s 6.23% after hitting 6.47% on Monday. TRY fell against USD and EUR.

Turkey’s five-year credit default swaps widened to an eight-month high of 148 basis points. Turkey secured its second investment grade in May but on-going anti-government protests are threatening its political stability and hurting investor sentiment. PM Recep Tayyip Erdogan is expected return from an official visit to North Africa on Thursday. The markets are anxious about his reaction. Erdogan initially dismissed the protestors as looters, extremists and a marginal group.

  Before the Unrest After the Unrest
  31-May 5-Jun 6-Jun
BIST-100                   85,990                80,733         79,637
USD (CBT, bid) 1.8842 1.8745 1.8796
EUR (CBT, bid) 2.4498 2.4522 2.4572
Bond (benchmark*, compound) 5.61% 6.23 6.24
Source: Bourse Istanbul, TCMB, * 07/01/15    
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