Turkey markets hit by EU entry uncertainty

Turkey markets hit by EU entry uncertainty

Recent trends in Europe have made the success of Turkeya��s efforts to gain membership in the European Union look increasingly uncertain.

Talks toward that goal between Turkey and the EU are scheduled to begin on October 3 and could last 10 years or more.

One factor that might make Turkeya��s bid to join the EU more difficult is the defeat of German chancellor Gerhard SchrA�dera��s party in last weekenda��s elections there. Mr. SchrA�der is a supporter of Turkeya��s bid, but the leader of the Christian Democratic Union, which is likely to return to power, is not in favor of Turkeya��s membership in the EU.

Since every EU government will eventually have to approve Turkeya��s application for membership, a change in Germanya��s government could hurt Turkey.

Elsewhere, polls are predicting that France will not approve the European constitution when the country votes on the issue on Sunday. A rejection of the constitution by France could hurt efforts to add more members to the EU.

All of this has hurt Turkeya��s economy, sending the stock market there down and lowering bond prices.

After Germanya��s announcement of an early election, Turkeya��s stock index fell 4.5 percent on Monday and a further .77 percent on Tuesday. Prices on the benchmark bond, to mature in 2006, fell while yields rose from 17.67 percent to 17.88 percent.

In a new auction on Tuesday an issue of 20-month bonds were sold to yield 17.71 percent, while similar bonds sold last month had a yield of 17.26 percent.

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