The Turkish stock exchange halted trading on Wednesday amid mounting losses from two massive earthquakes earlier in the week that have killed and injured thousands and threaten more economic hardship for country.
Turkey’s benchmark Borsa Istanbul 100 Index
dropped 7% on Wednesday before trading was reportedly suspended for stocks, futures and options following two circuit-breakers earlier. Trading will be halted through Tuesday, Feb. 14, according to the Borsa İstanbul, the operator of the Istanbul Stock Exchange.
The Borsa Istanbul 100 Index has dropped 11% in five days, bringing losses for the year so far to 24%. It tracks the performance of 100 companies from the National Market, along with real estate investment trusts and venture capital investment trusts listed on the Istanbul Stock Exchange. Bloomberg estimates that $35 billion has been wiped off the value of the main index.
The iShares MSCI Turkey ETF
which tracks dozens of Turkish equities, slumped another 6% on Wednesday, matching Tuesday’s losses after a 2.4% fall on Monday. The Turkish lira
hovered at a record low of 18.83 against the U.S. dollar.
Monday’s 7.8 magnitude quake in southern Turkey and northern Syria was followed hours later by a 7.7 aftershock, and has been estimated to be the worst in a decade.
As of Wednesday, over 11,000 people have died on both sides of the border, but the World Health Organization has warned that deaths could climb above 20,000 as rescuers and survivors struggle against freezing conditions. A similar 7.8 quake hit Nepal in 2015, killing 8,800.
Turkish geophysicist Prof. Dr. Övgün Ahmet Ercan described the Turkish city of Kahramanmaraş, near the epicenter of the earthquake, and its 250 kilometer circumference “as the most dangerous places in the world,” due to the major earthquake faultlines, according to comments in the Kisa Dalga podcast platform.
He also said that Turkey likely faces an economic burden of $50 billion dollars, adding that “in a time when there is no money, the economy in depression will collapse even more.”
Turkish President Recep Tayyip Erdogan has said 13 million of the country’s 85 million people have been affected by the disaster, declaring a three-month state of emergency in 10 provinces. Erdogan faces presidential and parliamentary elections in May and is already under pressure given the economic difficult and high inflation that exists in the country already.
In 2022, the Borsa Istanbul 100 Index rose 150% in lira terms, and 80% in dollar terms to a record level, standing out against lackluster returns elsewhere. The gains came as locals fled scorching inflation to bet on equities. Annual average inflation rose to 72.4% in January from 72.3% in December.