Turkey’s capital markets regulator imposed emergency measures Sunday, banning short-selling and easing share buyback rules for one month following a 17% stock market plunge sparked by the detention of Istanbul Mayor Ekrem Imamoglu on March 19.

What happened: Imamoglu, a key rival to President Recep Tayyip Erdogan, was detained last Wednesday on corruption allegations, triggering a massive sell-off in Turkish stocks and briefly sending the lira to a record low of 42 per USD. He was later formally arrested on Sunday. The Istanbul mayor had been set to secure the Republican People's Party (CHP) nomination for the 2028 presidential race in a primary on Sunday — a vote that proceeded with him behind bars. The CHP, Turkey’s main opposition party, has claimed the charges are politically motivated, an accusation Imamoglu himself has echoed.

On Sunday, Turkey’s Capital Markets Board banned short selling across all stocks and relaxed share buyback rules in a bid to stem further market losses, with the measures in place until April 25. Share buybacks allow companies to repurchase their own stocks, reducing the number of shares in circulation and potentially boosting their value.

Why it matters: Selling stocks en masse reduces the value of those stocks and causes negative investor sentiment, leading to more sell-offs and further deterioration of a market. Conversely, share buybacks can boost investor confidence in a market and increase the value of its companies, with the positive sentiment leading to more investors buying shares in the market, further raising its value.