The Impact of Fed Policy Announcements on Emerging Stock Markets: Evidence from Borsa Istanbul

Abstract

This paper aims to understand the impact of US nonfarm payroll announcements on emerging stock markets through concentrating on the Turkish Stock Exchange: BIST 100. We not only investigate the impact of each of the three components of the nonfarm payroll data for the whole period under consideration, but also look for possible differences among four sub-periods. A comparative analysis leads us to conclude that it is not the nonfarm payroll which significantly affect BIST 100, but the fact that it is regarded as an important indicator to foresee Fed’s policy actions that can alter the capital flows.