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Instant view: Turkish voters vote for constitutional changes

ISTANBUL (Reuters) - Turkish voters approved a raft of changes to the constitution in a referendum on Sunday, according to unofficial preliminary results, in what may be a key victory for Prime Minister Tayyip Erdogan ahead of general election due next year.

An initial count showed 59 percent voted “yes,” with 91 percent of ballot boxes counted, NTV news channel reported.

The 26 amended articles include expanding privacy rights, unions’ ability to organize and children’s rights. Most controversially, the changes overhaul the formats of the Constitutional Court and the Supreme Council of Judges and Prosecutors and how their members are appointed.

The government says the changes to the charter of 1982, drawn up under military rule, will bolster Turkish democracy. The opposition, including the Republican People’s Party (CHP) and the Nationalist Action Party (MHP), say the changes will solidify the ruling AK Party’s influence on state institutions.

Here is some initial commentary from political and economic analysts:

HSBC PORTFOLIO GENERAL MANAGER NAMIK AKSEL

“These initial results will have a positive effect on the markets. A 55 pct vote in favor had been priced in by the markets. A “yes” vote higher than 60 percent will have a positive effect in the short-term. I think the result will strengthen the possibility of a single party government. The result will have an initial positive influence but I don’t think this effect will be long-lasting.”

GARANTI INVEST STRATEGIST TUFAN COMERT:

“What we and the markets had expected was a “yes” vote of around 50-55 pct, thus the markets have priced in this range. A 60 percent vote in favor will create the impression that the single party government will continue. I expect the lira to grow stronger as a first reaction and the dollar/TL rate to fall below 1.50. We expect a “buy” reaction at first but that may be followed by profit sales after the initial reaction.”

OZLEM BAYRAKTAR, ECONOMIST, UNICORN CAPITAL

“This is much higher than expectations and what we saw in the opinion polls. It will certainly fuel a positive response on markets on Monday, and we could see the benchmark yield on the secondary bond market fall to below 8 percent. Equities will also show a strong response. But then I think from Tuesday data from the United States could be a focus for further support. This result shows the AK Party has strong support ahead of a the parliamentary election next year. I am sure they will present it as a large victory.”

SEMIH IDIZ, COLUMNIST, MILLIYET NEWSPAPER

“If (support) is over 60 percent, as the preliminary count indicates -- even though I think it will settle around 58-59 percent -- that’s a good margin for the government. It’s better than expected, and it’s a good endorsement ahead of next year’s elections ... I think the prime minister must be feeling pretty comfortable.”

SOLI OZEL, PROFESSOR OF INTERNATIONAL RELATIONS, KADIR HAS UNIVERSITY

“The preliminary results show ... that those outside of the AK Party bloc are part of this. It shows that Kurds, the CHP, the MHP were divided.”

SIMON QUIJANO EVANS, ECONOMIST, CHEUVREUX

“This is a very big surprise on the up side, the ‘yes’ vote is way ahead of expectations. It is strongly supportive of the government and its reform process and this is a very strong call to the European Union that they need to start speeding up the accession process with Turkey. This strengthens Turkey politically and also in the region.

“It seems the undecided voters voted ‘yes’ in the end.

“This strong a vote of confidence means markets will gain more confidence in there being a one-party majority in next year’s election. The bottom-line is to continue to look for strength in Turkish equities and foreign exchange.”

EMRE BALKESER, HEAD OF INSTITUTIONAL SALES AND TRADING, GARANTI SECURITIES

“A ‘yes’ vote is already priced, but market players will love anything above 55 percent. We will definitely open positive tomorrow, with shares rising 1.5-2 percent at the open, and if other markets are doing well, we could reach new highs.

“There is not much room for bond yields to fall further. With a strong ‘yes,’ the lira could reach 1.47 or 1.48 to the dollar.”

Reporting by Thomas Grove, Ayla Jean Yackley, Alexandra Hudson and Ebru Tuncay

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