Friday, April 8, 2011

Selling Turkey at the Bottum?

April 5th, 2011
David Goldman
A reader, Prof. Osman Gulseven, points out that the Turkish stock market is up 13% since I advised staying away from it. In fact, the market closed at 26.47 on March 1 when I published my note, and fell to 24.90 on March 7 before rising to 28.09 yesterday. That is a rise of 6%, not 13% on the MSCI, the index that foreign investors are most likely to trade. It is a curious situation. Turkey actually benefits from the chaos in the Arab Mediterranean, as perhaps $20 billion of tourist receipts will shift from North Africa to Turkey, as I reported in a “Spengler” essay at the main Asia Times site. Nonetheless I remain pessimistic about Turkey’s medium-term prospects. The bounce from extremely low levels does not persuade me.