Turkish presidential candidate Kilicdaroglu says market gains show confidence he will win

Presidential candidate of Turkey's main opposition alliance Kilicdaroglu holds an election campaign rally in Istanbul

ANKARA (Reuters) - Turkish presidential candidate Kemal Kilicdaroglu said gains in Turkish assets on Thursday indicated markets believe his alliance will win on Sunday, after polls gave him a narrow lead over incumbent President Tayyip Erdogan.

In an interview with Reuters, Kilicdaroglu said gains in Turkish assets indicated trust in his alliance's "rational economic policies".

On Thursday, Turkey's main stock index jumped, while credit default swaps dropped.

Stressing that Turkey has close economic links with Russia, Kilicdaroglu signalled that he would pursue a fine balance in foreign policy over relations with Moscow.

"We want to maintain our relations, we don't want to break our friendly relations but we will not allow interference in our internal matters," he said.

Kilicdaroglu also said he would push for another peace initiative between Russia and Ukraine once he wins the Sunday vote.

"It is very important for us, and for the whole world, if we succeed to reach a peace agreement between Russia and Ukraine. But we should make it clear that we do not find it right for any country to occupy another country," he said.

When asked whether he would support NATO enlargement if he is elected as Turkish President, he said "Of course," without elaborating.

"NATO is not only solely a military organisation in 21st century, it is also an organisation that defends democracy. We will maintain our relations with NATO within the same framework as we had in the past," Kilicdaroglu also said.

Kilicdaroglu said a fundamental problem of Turkey's foreign policy in Erdogan's AK Party (AKP) era was the exclusion of foreign ministry in the policy making process.

"We would pursue a peace-oriented foreign policy that prioritises Turkey's national interest. Our priority our national interests and to act in line with the modern world," Kilicdaroglu added.

(Reporting by Orhan Coskun, Huseyin Hayatsever and Ece Toksabay; Editing by Alexandra Hudson)