Turkish stocks flat

The Turkish lira firmed almost 0.5 percent against the dollar on Friday, benefiting from $350 million in dollar sales by the central bank and a recovery in global risk appetite but stocks were flat, closing with a weekly loss of almost 4 percent. The lira was quoted at 1.8360 in the interbank market by 1430 GMT after an official close of 1.8450 per dollar. It had ended Thursday at 1.85.
Earlier on Friday it had risen as high as 1.8300 after the central bank announced it was ready to sell up to $750 million at the daily forex auction. Against a euro-dollar basket the lira traded at 2.16011 compared with a previous close of 2.1479 but well off record lows beyond 2.21 hit earlier this week. "We are seeing a recovery in the lira due to the fact that the central bank has been offering record forex volumes at auction. However, general market sentiment is also more benign and all emerging market currencies have recovered somewhat," said Thu Lan Nguyen, emerging markets forex strategist at Commerzbank in Frankfurt.
The lira, like many emerging currencies, has had a rollercoaster week, plumbing record lows before recovering on the back of record dollar sales by the central bank and a cut in banks' reserve requirements. Turkish markets also received a boost from improved global sentiment after European policymakers took measures on Thursday to stem the region's financial crisis and positive US jobs data.
"The commitment of the central bank is likely to lead dollar/lira to 1.82," analysts at BNP Paribas predicted. On the bond market, benchmark two-year yields were at 8.38 percent, almost flat on the previous session's close. The Istanbul stock index closed just above flat at 57,338 points, sharply underperforming the emerging markets index, which was up 2.15 percent. The bourse has lost around 4 percent this week after a stellar September.