Turkish shares shed one percent on Friday as stock market investors awaiting the results of stress tests on European banks took profits on huge inflows into Turkish assets this week. The main Istanbul Stock Exchange National 100 closed down 1.03 percent at 59,299.53, retreating from the record high it set on Thursday and underperforming the MSCI emerging markets index, which gained 0.66 percent.
Banking stocks, subject to the strongest gains in the last five days ahead of expectations of strong earnings, fell 2.05 percent. Turkey's well capitalised banks have attracted much buyer interest while their beleaguered euro zone peers undergo tests on their financial health to calm investor nerves.
The strength of the banking sector has underpinned a strong economic recovery this year, distinguishing Turkey from euro zone and emerging market peers. Turkey's stock market, rebounding since concerns about the extent of the euro zone debt crisis have begun to abate, has risen almost 13 percent in 2010, significantly outperforming BRIC emerging equities and eastern European peers.
The yield on the benchmark April 2012 bond rose to 8.24 percent from 8.18 percent. The forecast for end-2010 inflation fell to 7.69 percent to 7.73 percent a fortnight ago in the central bank's most recent survey of expectations.
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