Daily Market Report

1. Executive Summary

• Market Direction: CAUTIOUS AND SELECTIVE We maintain our stance. The downward pressure and geopolitical risks we emphasized last week continue. The rebound seen on Friday does not signal a permanent trend reversal. Until a clear reversal signal is received in the index, position sizes should be kept small with high cash ratios.

• Performance of Previous Recommendations: as we recommended in our reports dated September 5-7, KCHOL ( target price 225 TL) and BIMAS ( target price 430 TL) has continued to outperform as a safe haven. ISCTR ( target price 14 TL) has maintained its positive divergence in the banking sector. The warnings we issued for EREGL (%-5.01), THYAO (%- 3.74) and ASELS (%- 3.90) on the avoid list have materialized exactly, with these stocks underperforming the index.

• General Assessment: In the current environment, regulatory measures such as the "Up Step Rule" alone are not direction-changing. The primary determining factors are the geopolitical tensions originating from Iran and the rise in global energy prices. In this environment, new purchases should not be rushed, and panic selling should be avoided.

2. News and Macro Assessment

• Geopolitical Risk (High Priority): The "economic war" statement from Iran and critical contacts are keeping concerns about energy supply fresh. This situation causes natural gas prices to remain permanently above 71 euros. Cost pressure is increasing for energy-intensive sectors (iron-steel, petrochemical) and airline companies.

• Macroeconomy: An inflation rate of 28.4% is expected. Minimum wage increase predictions after the OVP are on the agenda. If these expectations are not met, a loss of confidence may occur. Globally, US inflation data and the ECB interest rate decision are of critical importance for risk appetite.

• Supportive Developments: The additional 1.1 billion dollars provided to Halkbank supports the banking sector. Exports to the EU approaching 72 billion dollars and Iraq increasing its oil exports to 3 million barrels are positive for the foreign trade balance. Additionally, news about Turkey's increased resilience against external shocks is positive for the medium-long term.

• Sectoral Impact: Due to the increase in energy costs, EREGL, SISE, TUPRS the margins of energy-intensive companies will be pressured. Companies with domestic demand and high pricing power (BIMAS, KCHOL) it will be more resilient in this environment.

3rd Technical Evaluation (Stock-based)

• Positive Divergers (Safe Havens):

  • KCHOL (215.1 TL): Holding above the 210 TL support. Strong resistance and anchor position.Target: 225 TL, Stop: 210 TL.

  • BIMAS (415.75 TL): Resistant to the index with its inflation-resistant structure and pricing power.Target: 430 TL, Support: 415 TL.

  • ISCTR (13.01 TL): Holding above 13 TL. Leader of the positive divergence in the banking sector. If it breaks the 13.50 TL resistanceTarget: 14 TL.

• Negative Divergences (To Be Avoided):

  • EREGL (37.20 TL): 5-day -5.01% loss. Energy cost pressure continues. 37 TL support is critical; if broken, 35 TL target may be reached.

  • THYAO (296.00 TL): Negatively affected by geopolitical risks. Failed to break the 300 TL resistance.Stop-loss: 290 TL level must be strictly followed.

  • ASELS (388.25 TL): 5-day -3.90% loss. Trend damaged, no signal for new buy.

  • EKGYO (19.44 TL) and TAVHL (268.25 TL): Among the weakest looking stocks with -5.72% and -5.21% losses respectively.

4. Company/financial Evaluation

• Liquidity and Scale: KCHOL ( Current Assets: 3,615 mlyr TL) and SAHOL ( 2,790 billion TL) with their massive balance sheets are the companies with the highest financial flexibility. This makes them a safe haven during periods of geopolitical and macro uncertainty.

• Sectoral Fragility: EREGL ( Current Assets: 265 billion TL) due to its energy-intensive production structure, it is one of the companies that will be most negatively affected by the increase in natural gas prices.THYAO ( 512 billion TL) is fragile due to both fuel costs and route risks.

• Resilience: BIMAS ( 152 billion TL) stands out as a company with high pricing power in the retail sector, based on domestic demand, and with strong cash flow.ISCTR benefits from the positive outlook in the banking sector.

5. Risk Management and Strategy

• Risks:

  • Geopolitical Risk: The escalation of tensions originating from Iran could push energy prices even higher.

  • Macro Risk: If the OVP fails to meet expectations, a loss of confidence may occur.

  • Global Risk: US inflation and the ECB decision could negatively affect global risk appetite.

• Strategy:

  • No panic selling, but a clear trend reversal should be awaited for new purchases.

  • Stop-loss levels must be strictly respected: 290 TL for THYAO, 210 TL for KCHOL.

  • Leverage should be avoided, position sizes should be reduced.

  • Cash ratio should be kept high (% 40) and be ready to buy in case of a possible correction.

6. Recommended Portfolio

Weekly Recommended Portfolio Distribution:

Recommended Monthly Portfolio Allocation:

Note: This portfolio has been created considering current geopolitical and macro risks. Energy-intensive sectors (EREGL, SISE, TUPRS) and airline stocks exposed to geopolitical risks (THYAO) are also not recommended in the monthly portfolio. The portfolio will be updated according to changes in market conditions.

Legal Warning: This report is not investment advice. It is for informational purposes only. Base your investment decisions on your own research.