Resignation at the CMB! What is happening | Will France burn the Euro? | The resignation hit the stock market
Barış Soydan · 2026-10-19
💡 Quick Take
1. Borsa Istanbul (BIST 100): Don't rush to buy; watch critical support at 11,350 as political resignations spark panic selling.
2. Troubled private corporate bonds: Don't buy; roughly 35 billion liras in debt face severe default and liquidation risks.
3. Big bank money market funds: Hold or accumulate safe funds from Ziraat and İş Bankası yielding around 3% monthly.
4. Turkish Eurobonds: Accumulate for steady 0.6% monthly hard-currency yield alongside a gradually accelerating dollar.
5. Gold: Hold within the tight 4,100 to 4,200 dollar range while record fund inflows back long-term strength.
📊 Detailed Explanation
The week opened with sudden executive departures in Ankara. Mahmut Sütçü resigned as head of the Capital Markets Board (SPK), citing health reasons. At the same time, Deputy Minister of Treasury and Finance Osman Çelik took early retirement. According to the host, these departures represent the first bureaucratic accountability for the spreading mutual fund fraud scandal. Billions in investor capital remain frozen across troubled portfolio firms like Tera, Pusula, Hedef, and Atlas.
Parliament is currently reviewing a bill to authorize interim compensation payments of 1 million liras for defrauded investors. Legal experts warn that excluding settlement finality rights could spark hundreds of thousands of individual lawsuits. Meanwhile, Hedef Portföy plans to repay its investors directly without waiting for the bill. However, underlying portfolio assets suffered sharp declines during the freeze. Investors must prepare to accept noticeable losses on their original principal.
The scandal is spreading into the 1-trillion-lira corporate bond sector. Bloomberg analysis indicates that roughly 35 billion liras of private sector debt face serious non-payment risks. Mutual funds hold nearly half of all corporate debt issued in Turkey. Recent defaults by Adil Varlık Yönetimi and Tera already triggered real casualties. BV Portföy had to post rare losses on its money market fund after provisioning for defaulted Adil Varlık paper.
Heavy debt repayment deadlines loom right around the corner. Tera affiliate Peker GYO faces a 7.5-billion-lira lease certificate payment in November. Tera itself must repay 12 billion liras in lease certificates this coming January. The host clarifies that money market funds run by major lenders like Ziraat and İş Bankası remain completely safe. Ziraat Başak Money Market Fund delivered a 3.3% gross return last month, though upcoming central bank rate cuts may nudge net yields closer to 2.5%.
Currency movements are picking up speed after the central bank hinted it wants no deferred devaluation shocks before 2028. The dollar gained 0.44% last week, which works out to an annualized monthly pace of 1.90%. That rate still lags after-tax money market returns. However, Turkish sovereign Eurobonds offer around 0.6% monthly in foreign currency. Adding dollar gains to that coupon produces a combined return that rivals domestic cash deposits.
France is dealing with intense street protests led by students demanding higher public education spending. The French state cannot easily spend more because public debt exceeds 3 trillion dollars. Foreign institutions hold over 60% of French sovereign bonds and sell aggressively whenever budget deficits widen. Despite bond market stress, the Euro held steady against the dollar. Markets expect the European Central Bank to raise interest rates in both December and March.
Spot gold remains locked in its consolidation channel between 4,100 and 4,200 dollars, trading near 4,145 dollars. Silver sits slightly positive at 57.20 dollars. Traders scaled back expectations for aggressive Federal Reserve rate hikes, anticipating just one more hike in December instead of two. That shift eased pressure on American Treasury yields. Institutional money in gold funds reached an all-time record equivalent to 1 million ounces.
Wall Street saw early dip-buying following tech sector weakness, with key earnings due from Meta and Tesla. The host warns against chasing Tesla stock. Its current 1.4-trillion-dollar valuation sits far above peer multiples and historical five-year averages. Tesla failed to impress investors during its recent flying car reveal, leaving its premium price tag difficult to justify.
The Istanbul stock exchange suffered heavy afternoon selling right after the regulatory resignations broke. The BIST 100 dropped 2.5% to close at 11,430 after touching an intraday low of 11,396. The BIST All minus 100 index plunged 4.10%, erasing all gains back to January 2nd. Sixty stocks tumbled to their daily lower limit amid selling by public and foreign brokerages. Immediate chart support rests at 11,350, with resistance up at 11,620.
🎯 Finance Expert Opinion
The host offers a realistic reading of the systemic friction inside Turkish capital markets. Resignations at the SPK and Treasury expose deeper stress from unregulated fund leverage and corporate debt defaults. When money market funds report negative daily returns due to bad debt, investor psychology breaks quickly. Barış Soydan rightly separates retail bank funds from aggressive portfolio companies. Still, systemic counterparty risk demands utmost caution right now.
The corporate bond market looks like the biggest hidden hazard. With 35 billion liras of private paper at risk, fund liquidations could trigger an extended liquidity squeeze. Tera and Peker GYO have massive debt maturities lined up between November and January. If forced sales continue, liquidators will dump blue-chip equities to generate cash. That mechanical selling explains why large-cap industrial shares dropped sharply regardless of underlying company balance sheets.
A defensive cash posture makes the most sense here. Turkish Eurobonds provide an attractive risk-adjusted parking spot. They pay roughly 0.6% monthly in hard currency while protecting capital against accelerated lira depreciation. Conventional bank money market funds also remain viable for near-term liquidity. However, holding speculative small-cap equities or private debt instruments carries uncompensated risk during this regulatory clean-up.
The clear stance across Turkish risk assets is don't buy and do not catch falling knives. Wait for the market to test and defend the 11,350 support level on BIST 100 before committing fresh equity capital. Precious metals remain a solid hold on macroeconomic pullbacks, while Tesla should be avoided at current multiples. Preserve liquidity, steer clear of unvetted fund managers, and let forced institutional liquidations run their course.
⚠️ This content is not investment advice.
Kanal: Barış Soydan