Turkish shares open higher amid possible Fed rate hike

ANKARA (AA) - Turkish stocks opened slightly higher on Wednesday amid news of a possible rate hike by the U.S. Fed in September.

Borsa Istanbul's BIST-100, the country’s benchmark index, was up 0.12 percent (92.01 points) to reach 77,799.14 at the opening of the daily session Wednesday, after losing 0.98 percent on Tuesday.

The Turkish lira on Wednesday was trading slightly lower against the U.S. dollar after New York Fed President William Dudley said Tuesday that the Federal Reserve could raise its benchmark interest rate at its September meeting.

The lira started the day at 2.92 against the dollar, but the home currency was trading at 2.9387 at 10.30 am local time (0730GMT).

The benchmark 10-year government bond yield remained flat at 9.42 percent.

On Tuesday, the local fixed income markets were relatively flat. The two-year benchmark bond ended at 9.07 percent, unchanged from its previous close.

There will be no major local data announcements on Wednesday.

However, the Turkish market will await the minutes of the Fed’s last Federal Open Markets Committee meeting – expected at 10.00 pm (1900GMT), after the Turkish bell closes – which could shed light on whether the Fed is likely to raise rates in September.

Asian markets have been trading flat and European markets are expected to open somewhat higher on Wednesday.

The Federal Reserve could raise its benchmark interest rate at its September meeting, New York Fed President William Dudley said Tuesday.

"I think it is possible," Dudley said when asked the question by Fox Business Network. "We are edging closer towards the point in time when it will be appropriate to raise rates further," he said.

Dudley pointed to an improving job market, saying he believes the economy will be better in general in the second half of the year.

On Wednesday the government shut down Turkey’s Presidency of Telecommunication and Communication, or TIB, under a statutory decree as part of the current state of emergency, according to the Official Gazette.

Turkish defense company Aselsan (ASELS. TI; MP) is to announce its second quarter financial results on Wednesday. The market expectation is at 118 million lira ($40 million) net profit.