Global markets started the week with mixed trends amid a busy data schedule.

Global markets started the week with a mixed trend due to concerns that U.S. Federal Reserve (Fed) Chairman Jerome Powell indicated last week that they would not rush into interest rate cuts and that geopolitical risks could increase.

While there are still uncertainties about how the policies of Donald Trump, who was elected President in the U.S., will affect the Fed's monetary policy, the inflation data released last week is also leading investors to be cautious.

Although the inflation data released last week aligned with expectations, signals taken from the subcategories of the data are dampening risk appetite. On the other hand, retail sales in the country also exceeded forecasts with a 0.4% increase.

IS THE INTEREST RATE CUT EXPECTED BY THE WORLD DELAYED UNTIL SPRING?

Following these developments in the money markets, predictions that the Fed may not continue with interest rate cuts next month have been included in pricing. Accordingly, it is anticipated that the bank will reduce the next policy rate by 25 basis points with a 65% probability and keep it unchanged with a 35% probability.

On the other hand, there are concerns that Trump's pre-election promises, such as high tariffs on imported goods, tax cuts for companies, and immigration restrictions, could create inflationary pressure and that the U.S. economy may not achieve a "soft landing."

BIDEN'S DECISION HAS BECOME A NEW SOURCE OF CONCERN

Meanwhile, Joe Biden, who will continue to serve as President until January 20, has caused an increase in risk perception by granting permission for the use of U.S.-made missiles in Russia by Ukraine.

While the verbal guidance of Fed officials is also being monitored, Boston Fed President Susan Collins stated that the option of an interest rate cut is on the table in December, emphasizing that the Fed's decision will be shaped by upcoming data.

Chicago Fed President Austan Goolsbee expressed that if inflation continues to fall towards the Fed's 2% target, interest rates will be lower than current levels in the next 12-18 months.

Richmond Fed President Tom Barkin also stated that he expects inflation to continue to decline next year. Barkin, who noted that he expects core inflation to decrease, said, "I still see progress."

THE DOLLAR IS PLAYING AT PEAKS

The U.S. 10-year Treasury yield, which has increased by about 10 basis points since last week, is at 4.44% today, and the dollar index is at 106.7, the highest level since November 1, 2023.

The price of gold per ounce has been on a downward trend for the last 6 trading days, reaching its lowest level in about 3 months, and started the week with a 1.2% increase at $2,590, while the price of Brent crude oil per barrel began at $71.2 with a 0.5% increase.

On Friday, the S&P 500 index fell by 1.32%, the Dow Jones index by 0.7%, and the Nasdaq index by 2.25% on the New York Stock Exchange. Index futures in the U.S. started the new week with a mixed trend.

European stock markets had a negative trend last week due to concerns about possible U.S. tariffs that could negatively affect the Eurozone economy, along with the news flow from the U.S.

MARKETS FOCUSED ON THE ECB

Analysts stated that Trump's statements about increasing tariffs on Europe and China have caused a high level of risk perception in the region.

On the other hand, in the pricing of money markets, the European Central Bank (ECB) is expected to make a 25 basis point interest rate cut next month, while signals from ECB President Christine Lagarde's speeches on Wednesday and Friday are expected to have an impact on market direction.

Last week, shares of vaccine manufacturers and pharmaceutical suppliers came under pressure after U.S. President-elect Donald Trump nominated Robert F. Kennedy Jr., who is skeptical about vaccines, as the U.S. Secretary of Health and Human Services.

Sartorius lost 6% in value, while shares of pharmaceutical packaging manufacturers Schott Pharma and Gerresheimer fell by 5.3% and 2.9%, respectively.

With these developments, on Friday, the FTSE 100 index in the UK fell by 0.1%, the DAX 40 index in Germany by 0.3%, the CAC 40 index in France by 0.6%, and the FTSE MIB 30 index in Italy by 0.6%. Index futures in Europe started the new week with a mixed trend.

TENSIONS WITH CHINA HAVE DECREASED IN BIDEN'S LAST DAYS

In Asian stock markets, a positive trend is observed, except for Japan, following Chinese President Xi Jinping's meeting with Joe Biden.

The Chinese Foreign Ministry shared details of the meeting between Chinese President Xi Jinping and U.S. President Joe Biden during the Asia-Pacific Economic Cooperation (APEC) Summit held in Peru. It was reported that in his last meeting with Biden before taking office, Xi reiterated Beijing's stance on issues it sees as "red lines" in relations, especially regarding Taiwan.

Xi argued that China has sovereignty and maritime rights in the South China Sea, which is subject to sovereignty disputes with other coastal countries, stating, "The U.S. should not interfere in bilateral disputes over islands and reefs in the South China Sea and should not provoke."

The government in Hong Kong Special Administrative Region has revised its growth forecast for this year from 2.5% to 3.5% to the pessimistic estimate of 2.5%. The local government cited "challenges in external conditions" and "political uncertainties" as reasons for the revision.

JAPAN IS DISCUSSING INTEREST RATE INCREASE

On the other hand, Bank of Japan Governor Kazuo Ueda reiterated that the central bank will continue to raise interest rates if the developments in the economy and prices align with forecasts.

According to the data released today in the country, core machinery orders decreased by 0.7% month-on-month and 4.8% year-on-year in September.

With these developments, the Nikkei 225 index fell by 1% near the close, while the Kospi index in South Korea rose by 1.7%, the Hang Seng index in Hong Kong by 0.9%, and the Shanghai Composite index in China by 1%.

BIST ISTANBUL CLOSED THE WEEK WITH A DECLINE

In the domestic market, the BIST 100 index on the Istanbul Stock Exchange, which followed a selling trend on Friday, completed the week with a 0.33% loss, finishing at 9,389.62 points.

The Dollar/TL closed at 34.6000 with a 0.8% increase on Friday, while today it is trading at 34.4630 with a 0.4% decrease in the interbank market.

DEBT STATISTICS AND HOUSING PRICE INDEX ARE IMPORTANT DATA

Analysts stated that today, short-term external debt statistics and the housing price index will be monitored domestically, while abroad, the foreign trade balance data in the Eurozone will be followed, noting that technically, the support levels for the BIST 100 index are at 9,300 and 9,200, while the resistance levels are at 9,430 and 9,650 points.

Data to be followed in the markets today is as follows:

10:00 Turkey, September short-term external debt statistics

10:00 Turkey, October housing price index

13:00 Eurozone, September trade balance