Topsy-Turvy Turkey?

It interesting to note that despite the recent gains Turkish equities saw in January 2019 (+15.7%) to make up for December 2018 (-6.87%), the asset class has experienced some nasty losses in February (-3.63%) and March (-4.36% so far) - all of which are quickly eroding all YTD gains. 

Its the only EM market to have suffered such losses so far (rivaling that of South Africa). To add insult to injury, it appears that Turkish equities have had great difficult trying to break through its 50-Day EMA as well, indicating global equity investors are loosing faith in Turkish equities. 

To complicate matters even further, the Turkisk Lira ( USD/TRY ) has been down 3.46% against the US Dollar so far in 2019, putting further stress on the currency. 

In continuation from last year, it may mean that markets are trying to tell us something about the health of the Turkish economy for 2019. As global investors continue to shed Turkish assets throughout 2019, this is one space investors should be very wary of investing in over the next little while. 

We recommend caution against Turkish assets.

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