Sharp decline on Borsa Istanbul amid liquidity crisis and fund outflows
As indexes plummeted sharply due to fund outflows, default announcements, and a liquidity squeeze on Borsa Istanbul, the BIST 100 closed the day down 5.54%.
While Borsa Istanbul experienced some of its sharpest declines in recent times, outflows from investment funds, default announcements, and a liquidity squeeze turned the market upside down. The BIST 100 index finished the day with a 5.54% loss, while over 60 stocks hit their floor levels.
Sharp Declines on Borsa Istanbul
As Borsa Istanbul indexes left behind one of their worst days in the recent period, declines mostly exceeding 7% were recorded. Banking and IPO indexes were among the hardest hit.
Circuit Breaker and End-of-Day Data
Due to the sharp drops in the market, the market-wide circuit breaker was triggered at 16:04, and trading resumed at 16:24. The BIST 100 index closed yesterday down 5.54% at 13,122.5 points.
Liquidity Squeeze and Fear of Default
Behind the market crash were the relations between investment funds and equities, as well as the growing liquidity problem. Pusula Portföy's announcement that it had defaulted spilled over to other companies, creating a liquidity crisis.
Massive Outflows from Investment Funds
Since August 28, net capital outflows from TEFAS open-ended and closed-end investment funds have exceeded 210 billion liras, and the portfolio size of the funds has declined. Atlas Portföy also announced that it would make outflow payments 5 business days later.
Legal Investigation Launched
An investigation has been launched against former Borsa Istanbul Chairman and former CBRT Vice Chairman İbrahim Turhan on the grounds that he made social media posts about capital market instruments that would cause fear and panic among investors.