While global markets follow a mixed course as the closure of the Strait of Hormuz increases risks and costs for energy supply, the non-agricultural employment data to be announced in the USA today is expected to have an impact on the direction of the markets.
While the ongoing geopolitical tension in the Middle East keeps the global risk perception high, concerns are increasing that conflicts may prolong and rising energy costs may strengthen global inflation again.
In his statement yesterday, US President Donald Trump claimed that the Iranian government would give up and later that Cuba would also fall. Noting that the USA is in contact with Cuba’s communist administration, Trump said, “They need help. We are in talks with Cuba.” he said.
Trump stated that he will have an influence on determining the new leader of Iran and said, “We will work with the people and the regime to ensure that someone who can build Iran well without nuclear weapons comes to power.” he said.
The US employment report for February, which will be announced today, including non-agricultural employment and unemployment rate data, has become the focus of investors.
Employment data, which has been the focus of the US Federal Reserve (Fed) for a while, exceeded expectations in recent months, indicating that the labor market is healthy. Other employment data released this week also signaled that there was no cooling in the US labor market beyond expectations.
Analysts said that the signals to be received from these data today may affect the predictions about the Fed’s interest rate cut expectations.
In addition to geopolitical developments and economic data, the statements of Fed officials are also closely followed. Richmond Fed President Tom Barkin said that how the Fed reacts to the US and Israel’s war with Iran will depend on how long the impact of this situation on the US economy will last. Barkin underlined that the increase in gasoline prices is an inflationary situation.
Yesterday, the Dow Jones index fell by 1.61 percent, the Nasdaq index by 0.26 percent and the S&P 500 index by 0.56 percent due to concerns about increasing global risk perception and high energy costs. Index futures contracts in the USA started the new day with buyers.
Oil prices, which have been rising since the beginning of the week due to the conflicts in the Middle East and the closure of the Strait of Hormuz, are on a downward trend in the new day. While Brent oil completed the day at $83.2 with a 3 percent increase yesterday, it is traded at $82.9 with a 0.4 percent decrease in the new trading day.
While a sales-oriented trend was prominent in the US bond markets yesterday, the US 10-year bond interest ended the day at 4.14 percent with an increase of 6 basis points. Bond interest rate remained horizontal on the new day.
While the dollar index closed at 99.3 with a 0.6 percent increase yesterday, it is at 98.9 with a 0.4 decrease on the new trading day.
While the ounce price of gold closed the day at 5 thousand 77 dollars with a 1.2 percent decrease yesterday due to the rise in the dollar index, profit realizations and high volatility in the markets, on the new trading day it is traded at 5 thousand 130 dollars with a 1.1 percent premium.
While a negative trend stood out in European stock markets due to the ongoing geopolitical tensions in the Middle East, statements from the region were followed.
While Joachim Nagel, President of the German Central Bank (Bundesbank), made the assessment that the effects of a rapid end to the conflict on inflation would be short-term and generally limited, he underlined that otherwise, high energy prices for a long time could lead to both an increase in inflation and a weakening of economic activities in the Eurozone.
Nagel also pointed out that a prolonged war, especially in the Iranian axis, could disrupt macroeconomic balances.
Analysts stated that the fragile growth environment on the European side, being affected by high energy costs and geopolitical uncertainties, are among the main risks in the region, and that it is likely to lead to the prolongation of the ongoing inflationary struggle.
European Union (EU) High Representative for Foreign Affairs and Security Policy Kaja Kallas stated that Iran is trying to export the war and spread it to as many countries as possible.
Kallas stated that the chaos in the Middle East was the result of the erosion of international law and held China and the USA, as well as Russia, indirectly responsible for this situation.
On the company side, according to reports in the German press, it was reported that German automotive manufacturer Volkswagen is considering producing military vehicles at its Osnabrück factory in Germany.
With these developments, the FTSE 100 index in England decreased by 1.45 percent, the FTSE MIB 30 index in Italy decreased by 1.61 percent, the CAC 40 index in France decreased by 1.49 percent and the DAX 40 index in Germany decreased by 1.61 percent. Index futures contracts in the region started the day with light buyers.
While a positive trend is observed on the Asian side, except for South Korea, rising energy costs and energy supply throughout the region are among the main agenda items.
In addition to the energy export measures taken by China recently, access to the Russian market is also effective in making the risk perception in Chinese markets feel more limited.
While China and Hong Kong markets are diverging positively in the region, investors are reassured by the expectations that manufacturing industry activities in the country will not suffer a major disruption and energy supply will continue.
In addition, Chinese Premier Li Qiang presented the government’s work report and draft budget to the parliament at the annual general assembly of the National People’s Congress (CNC) held in Beijing. The Chinese government announced that the country’s economy is aimed to grow by 4.5 to 5 percent in 2026. Thus, the growth target of around 5 percent in the previous 3-year period was withdrawn.
In addition, the draft budget submitted to the ÇUHK included an article to increase defense expenditures by 7 percent this year to 1 trillion 909 billion 561 million yuan (276.8 billion dollars).
While the macroeconomic data announced in the region are also closely followed, the Consumer Price Index (CPI) in South Korea in February was below expectations, with a monthly increase of 0.3 percent and a 2 percent increase on an annual basis. Despite inflation figures coming in below expectations, South Korean markets continue to sell off due to ongoing geopolitical tension and energy supply concerns.
With these developments, near the closing, the Nikkei 225 index in Japan increased by 0.4 percent, the Hang Seng index in Hong Kong increased by 1.6 percent and the Shanghai composite index in China increased by 0.2 percent, while the Kospi index in South Korea decreased by 0.7 percent.
BIST 100 index at Borsa Istanbul, which followed a buying-oriented trend yesterday, closed the day at 13,078.93 points, gaining 1.05 percent in value.
The April futures contract based on the BIST 30 index in the Borsa Istanbul Futures and Options Market (VIOP) was traded at 15,201.00 points in last night’s session, with a 0.65 percent decrease compared to the normal session closing.
While Dollar/TL closed yesterday at 43.9970, today it is traded at 44.0720 at the opening of the interbank market, 0.2 percent above the previous closing.
Analysts said that an intense data agenda will be followed today, especially the treasury cash balance in the country, growth in the Eurozone abroad, statements of European Central Bank (ECB) President Christine Lagarde and non-agricultural employment data.
Stating that geopolitical developments and the news flow from the Middle East have an impact on the direction of the index, analysts noted that technically, 13,100 and 13,200 points in the BIST 100 index are resistance, while 13,000 and 12,900 points are support.
