
AI-generated summary
Allegations of manipulation in the Turkish stock market have been circulating since the fourth quarter of 2025, involving investment management companies buying large amounts of small, illiquid stocks with low floats to artificially inflate prices, with Turkey's Capital Markets Commission saying such investments cannot be explained by economic realities or financial fundamentals.
Türkiye's stock market manipulation scandal continues to spread. Pictured is the Istanbul Stock Exchange. (AFP)
[Financial Channel/Comprehensive Report] The Turkish stock market manipulation scandal continues to spread, not only threatening Turkey's emerging market status, but also Turkey's listed companies are now facing the risk of being excluded from global indexes. The index compilation agency MSCI announced on Thursday (15th) that it has immediately frozen some index-related adjustment measures for Turkish stocks and will continue to implement them until further notice.
"CNBC" reported that accusations began to circulate in the Turkish market in the fourth quarter of 2025, claiming that some investment management companies bought large quantities of shares of small listed companies with low circulating shares and insufficient liquidity, artificially pushing up stock prices. Türkiye's Capital Market Commission (SPK) later said the stock investments "cannot be explained by economic realities or the financial fundamentals of the companies involved."
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As a result, in September this year, Pusula Portföy became the first Turkish asset management company to report the default of its funds. In the next few days, its peer Tera Portföy announced that two of its funds also defaulted. Türkiye's benchmark stock price index BIST 100 plunged 16.7% in September.
As multiple investment funds suffered heavy losses and faced pressure from investors for redemptions, SPK intervened and ordered the liquidation of 131 investment funds a few days later. The total assets under management of these funds ordered to be liquidated reached approximately 1 trillion Turkish Lira (approximately US$20.2 billion, NT$643.3 billion). Borsa Istanbul also announced that 10 stocks at the center of the scandal would be removed from the BIST 100 index starting in early October.
MSCI said on Thursday that the scandal could lead to the revocation of Turkey's emerging market status and that it had immediately frozen some index-related adjustments to Turkish stocks and would continue to implement them until further notice.
Freezing stock index adjustments means that Turkish companies will not be included in some MSCI indices, nor will they be upgraded to include large companies in the index. Existing constituents will not receive higher index weights due to changes in share count or changes in the proportion of shares available to foreign investors.
MSCI further said on Thursday: "If sufficient progress is not seen by June 2027, MSCI will consider additional measures, including launching a consultation on whether to reclassify the MSCI Turkey Index from emerging markets to frontier market or independent market status."
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AI outlook — possibilities, not facts
MSCI to reassess Türkiye's position in emerging markets by June 2027
Likely · Within months
Türkiye's Capital Markets Commission to further investigate investment firms suspected of manipulation
Very likely · Within weeks

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