Global markets start week with cautious optimism

ISTANBUL

Global markets started the week cautiously as geopolitical developments originating from the Middle East continue to determine the direction of the markets.

Ongoing tensions between the U.S. and Iran, along with Israel’s new attacks on Lebanon and statements that the U.S. could impose new economic sanctions on Iran, increased geopolitical uncertainties.

Analysts stated that geopolitical uncertainties were the factor affecting the markets the most, noting that this situation put pressure on risk appetite.

Risk appetite in global markets decreased on Aug. 14 after macroeconomic data released in the U.S. last week fell short of expectations.

U.S. retail sales fell 0.6 percent in July despite expectations of an increase, recording their first decline since October 2025.

The consumer confidence index measured by the University of Michigan also fell to 51 in August, coming in below market expectations.

These figures showed that the U.S. public’s perspective on the economy became more pessimistic and increased concerns about the growth outlook.

Estimates that the Fed would not change its policy rate next month strengthened as retail sales also fell following the slowdown in U.S. inflation.

In money market pricing, the probability of the bank raising interest rates in September dropped to 30 percent, while the possibility of an interest rate hike by the end of the year lost momentum.

Investors will also closely follow the meeting minutes the Fed releases this week.