The Istanbul and Cairo Stock Exchanges Record Remarkable Results in August 2023

Despite a 5.8% decline in emerging markets, the Istanbul and Cairo stock exchanges achieved their biggest gains in a month during August 2023.

Emerging Markets Experience Worst Month Since 2015

Bloomberg reported that August 2023 was a challenging month for emerging markets, marking their worst performance since 2015. However, the situation was quite different for the stock exchanges in Turkey and Egypt.

According to Bloomberg, Egypt and Turkey were able to protect their markets from the negative effects of escalating economic troubles in China and the US Federal Reserve’s plans to raise interest rates. This was mainly due to monetary policy resets and local investors buying in order to hedge against rising inflation.

A Shift in Market Performance

The results seen in August 2023 represented a significant shift from the first seven months of the year. Turkish and Egyptian equities had been experiencing some of the largest losses among dollar equities in emerging markets during that time.

Istanbul Stock Exchange

The underlying Istanbul 100 stock index has shown remarkable growth this year, with a 44% increase in local currency terms. However, its performance in dollar terms has remained relatively stable. Currently, the stock index is trading at approximately 10 times the expected returns of its participants.

Cairo Stock Exchange

The Egyptian stock index has also experienced positive growth, with a 29% increase in local currency this year. In dollar terms, it has seen a 3% increase, taking into account the depreciation of the Egyptian pound.

Source: Bloomberg