Historic drop on Borsa İstanbul amid fund outflows and default announcements
Due to heavy outflows from investment funds and news of defaults, Borsa İstanbul experienced one of the sharpest declines of the recent period, closing the day with a loss.
Borsa İstanbul experienced one of the sharpest declines of the recent period under the influence of outflows from investment funds, default announcements, a liquidity crisis, and rumors on social media; while the BIST100 index finished the day with a 5.54 percent drop, numerous stocks hit the floor level.
Historic Drop in the Market
Borsa İstanbul indices left behind one of their worst days in recent history without any extraordinary internal or external factors, with over 60 stocks hitting the floor level. While the BIST100 index completed the day with a 5.54 percent decrease at 13,122.5 points, circuit breakers were triggered during the day.
Social Media Rumors
Among the rumors spreading in the markets were claims that Destek Finans Faktoring would be removed from the BIST30 and that MSCI might take a negative decision regarding Turkey. These unfounded or alarming posts unsettled investors.
Default and Liquidity Crisis
Following the Capital Markets Board's new fund guide on August 28, Pusula Portföy announced that it had defaulted. When high-value, one-sided fund positions could not be converted into cash, a liquidity crisis was triggered.
Corporate Statements and Investigation
Tera Group's steps to acquire Pusula Portföy and the subsequent transfer chaos caused confusion. Meanwhile, an investigation was launched against former Borsa İstanbul President İbrahim Turhan due to his social media posts.
Billions of Liras in Fund Outflows
Following the turning point of August 28, a total of 210 billion 255 million liras in net cash flowed out of open and closed-end investment funds on TEFAS. While portfolio sizes declined significantly, the majority of the outflows were seen in money market funds.
Stocks Hitting the Floor
Numerous company stocks connected to Pusula Portföy and Tera Group dropped by 10 percent to hit the floor price. Experts noted that stocks shown as collateral in reverse repo transactions were affected by this process.
Atlas Portföy Extended Payment Duration
Following Pusula Portföy, Atlas Portföy also announced that it extended the investment fund exit payment period from 2 business days after the request to 5 business days, notifying the Public Disclosure Platform (KAP) of the new rules.