Record profit from companies in the stock market

The growth data for the second quarter of the year will be announced today. An increase of more than 7 percent expected. In the first quarter of the year, 7.3 percent growth was achieved.

7 percent or more is high growth. The long-term average growth rate is around 5 percent.

➔ The growth of the cake is also important, but also who gets how much of the cake. It is known that the share of labor payments has been declining continuously in recent years. Labor payments, which were 39.1 percent of the gross domestic product in the first quarter of 2020, decreased to 31.5 percent in the first quarter of 2022.

➔ In fact, this share fell to 25.8 percent in the last quarter of last year. It is necessary to give the recovery in the first quarter to the minimum wage increase.

➔ The share of labor payments in GDP to be announced today may be a little more eroded.

➔ Because as can be seen adjacent While the share of labor payments in the pie is shrinking, the share of profits, defined as net operating surplus, is increasing.

PROFITS ARE A RECORD, WHAT ABOUT FEES?

➔ As a matter of fact, while the share of profits was 41.7% in the first quarter of 2020, it increased to 47.6% in the first quarter of 2022. Again, in the last quarter of last year, this share had increased to 57.8 percent.

➔ Here is an example of listed companies that reflect some of the profit growth. The balance sheet announcements for the second quarter of the year are over. Ziraat Investment’s There is an adjacent table of the profits it has compiled for each quarter.

The second quarter profit of 429 companies rose to 192 billion liras. In the same period of last year, these profits were 48.9 billion liras. The one-year increase is 293 percent.

➔ Also capital market advisor Yunus KayaLet’s give place to another table prepared by . He also made a sector-based compilation. While the net profit of 429 companies was 51.8 billion liras in the second quarter of last year, it increased to 200.1 billion liras this year. The increase is 286 percent.

➔ Although the number of companies is the same, close, there is a difference of 8 billion liras. In the past, the stock market used to issue annuals of companies, collect profits and analyze them with various ratios. He also came up with a common figure. Times have changed now.

REASONS FOR PROFIT RECORD

Profits for listed companies are historically record high. Such an increase in profitability was not seen after 1986, when the Istanbul Stock Exchange became operational.

The opening of the post-pandemic period, high growth, increase in exports through rising exchange rates, the largest loan increase in history with the deepest negative interest rates, the big inflation jump in a very short time like 7 months can be counted among the reasons that increased the profits of the company to the historical level.

➔ Recently, there has been a revival in the stock market with the effect of foreign purchases. The share of foreign investors in the stock market hit the historical bottom with 32.71 percent on 3 August. With the foreign outflows that have been continuing since 2019, their share has decreased from 64 percent to here.

By August 25, the share of foreigners increased to 35.11 percent according to Finnet data. Foreign share increased by 2.4 points in 3 weeks. There was no increase in this level after 2019. It’s the first time.

➔ If the monetary amount of this increase is $724 million for the term through August 19. Last week’s data will be released this Thursday. The number will get bigger.

AUGUST INCREASE OF THE STOCK 18%

➔ With foreign influence From August 3 to August 29, the stock market’s value increase reached 18 percent. The stock market index rose to 3,164 points. However, the index monitored in TL terms does not reflect the truth due to high inflation.

The dollar-based index increased from $ 1.5 to $ 1.74. The increase here is 16 percent. The difference of close to 2 points between TL and dollar-based index is due to the increase in the dollar.

The stock market has just risen to its average level since 2018 with an index of $1.74. The average stock market index in dollar terms was $2.12 in 2018, $1.74 in 2019, $1.62 in 2020 and $1.71 in 2021. The average of four years comes to $1.74. Here, with the August attack, the stock market only caught the average of the last four years.

➔ The 8-month average stock market index for 2022 was 2.360 and the dollar rate was 15.5782. Accordingly, in the remaining period of 2022, the stock market index remains at an average of 1.51 dollars. It has not yet reached the average level of 1.71 dollars last year or 1.74 dollars in the last four years.

THE SECOND LEVE IS ALSO IN ACTION

➔ While profits are at record levels, prices are actually below their long-term averages in dollar terms. I’m not even going back 4 years.

➔ if we go After 2000, we see that the average of the stock market is $2.47. It doesn’t even need to be a record. It’s unlikely for now.

➔ Despite the record profitability of the companies, the real level of prices in the stock market is at the bottom, and the reverse is experienced on both sides.

➔ One is due to the rapid rise of the dollar. Prices and increases in value cannot keep up with the dollar.

➔ The other is due to the fact that the foreign leg of the stock market was missing until the beginning of August. The stock market just got its second leg.

If foreigners keep coming, this leg will also work and the stock market will run on two legs. However, if this leg is cut off, the stock market will limp again.

➔ Here, the identity of foreign investors and the reasons for their arrival will also be decisive. My opinion on this matter is not clear yet. I’ll post when it’s clear.

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