Entering 2026: Market Trends and Sectoral Analysis

Market Developments and General Analysis

As we welcome the year 2026 on this first trading day, US indices closed higher, ending a series of declines in recent days. Technology stocks and the semiconductor sector stood out, while the positive outlook in industrial and defense stocks supported the Dow Jones. However, weak signals from giants like Apple, Microsoft, and Amazon limited the rise in the S&P 500 and Nasdaq.

Recovery in Small-Cap Stocks

The Russell 2000 index, representing small-cap firms, showed a significant recovery. Following the year-end rally that was not observed by the end of 2025, the direction of 2026 in global markets appears to depend on monetary policies and the course of macroeconomic data.

Monthly Data Calendar and Expectations

This week, the data calendar in the US is becoming more intense. The process will begin with the release of the ISM manufacturing PMI data. Additionally, the ADP private sector employment, JOLTS job openings, and non-farm payroll data will be closely monitored by investors.

Fed's Interest Rate Cut Expectations

On the Fed front, it is anticipated that data regarding the labor market will be decisive for interest rate cut expectations. A weak employment report could support interest rate cuts for the second half of the year, while strong data may delay these expectations.

Geopolitical Risks and Their Impact on Markets

The US operation against Venezuela is another development that has increased risk premiums. However, it seems that market reactions have been limited for the time being. Energy markets have not experienced significant volatility in the short term; crude oil futures are trading down nearly 1%, while gold and silver prices are showing upward reactions.

Developments in Asian Markets

In Asia's stock markets, there is a buying trend observed in Japan, China, and Hong Kong. Statements from the Bank of Japan indicate that the possibility of tightening monetary policy is on the agenda.

Turkey Markets and Inflation Data

Domestically, the important agenda item for the week is the inflation data for December. Monthly inflation is expected to come in at around 1%. This data may indicate an annual inflation rate around 31% and could maintain a disinflation trend.

Investment Strategies and Stocks

The BIST 100 index in Borsa Istanbul started strong, led by banking stocks, and the technical outlook has developed positively. Additionally, with the Central Bank of Turkey's interest rate cut process, a downward trend is being observed in bond yields. The weak performance of the Turkish Lira against the global dollar is noteworthy.

As we enter the year 2026, the effects of developments both domestically and internationally on pricing must be taken into account. Inflation data and the stance of the Central Bank of Turkey are critically important for investors.