Turkey Stocks Rise as Fitch Says Anti-Terror Law Cuts Risk

Turkish stocks rose, led by banks, after Fitch Ratings said the country’s adoption of anti-terrorism financing legislation reduced the risk of market access for entities including the sovereign.

The Istanbul Stock Exchange National 100 Index added 1.1 percent to 78,078.81 points at the close in Istanbul, climbing the most since Feb. 1. The 16-member banking gauge increased by 1.6 percent.

Parliament’s Feb. 8 adoption of anti-terrorism financing legislation “reduces the risk of suspension” from the Organization for Economic Cooperation and Development’s Financial Action Task Force, Fitch said in a statement today. Failure to pass the legislation “could have disrupted access to financial markets” for Turkish entities, it said. One of the “key assumptions” underlying Turkey’s lifting to investment grade was avoiding any potential sanctions, the rating company said.

“The Fitch statement seems to have acted as an occasion to buy,” Bulent Sengonul, an analyst at Is Investment in Istanbul, said by phone today. “This in essence is a reaction to the correction of the past few weeks.”

Turkish stocks have dropped 9.7 percent from their high on Jan. 24, bringing their loss on the year to 0.2 percent.

Turkiye Garanti Bankasi AS, co-owned by Spain’s BBVA SA, surged 2.9 percent. Akbank TAS, the lender part-owned by Citigroup Inc., advanced 1.2 percent. Turkiye Vakiflar Bankasi TAO advanced 1.5 percent, extending this year’s gains to 15 percent. Turkiye Is Bankasi AS rose 1.3 percent while Yapi ve Kredi Bankasi AS, co-owned by UniCredit SpA, added 1.2 percent.

FATF warned Turkey in October that it risked being suspended from the organization if it failed to pass the law by Feb. 22.

Fitch upgraded Turkey’s credit rating in November, giving the nation its first investment-grade rating since 1994.