Turkish banks headed for their longest streak of gains in almost three years after the International Monetary Fund said the economy was on track for a soft landing and a Spanish bailout buoyed stocks worldwide.
The main banking index added 2 percent to 113,598.9 at 12:15 p.m. in Istanbul, up for an eighth day in the biggest stretch of advances since August 2009. Turkiye Garanti Bankasi AS, Akbank TAS and Turkiye Is Bankasi AS led the gauge’s rise.
“Turkey’s positive divergence continues,” Isik Okte, strategist at Halk Invest in Istanbul, said in an e-mailed report. “After recommendations to buy Turkish banks from seven investment groups in three days, flows to Turkish banks increased on the back of an IMF report Friday night praising the Turkish economy.”
The IMF report issued June 8 said Turkey’s economy was decelerating toward a soft landing, helping to improve imbalances built over the last two years. Credit Suisse recommended buying Turkish banks in a note dated June 8 and e-mailed to clients today, saying their strong fundamentals weren’t yet priced in and valuations were attractive.
Akbank jumped 2 percent to 6.10 liras, Garanti rose 1.2 percent to 6.54 liras, Isbank added 1.8 percent to 4.07 liras and state-run Turkiye Halk Bankasi AS increased 2 percent to 13.10 liras.
Turkish lenders are trading at par with their book value, compared with 1.9 times book value at the end of 2010 and 1.2 times book value at the end of last year. The banking index has gained 15 percent this year, including 10 percent in the past eight days.