Having deeply delighted by and overwhelmed with the final agreement with P5+1and Iran, the participants in the market were utterly moved and shocked by the stocks laggard in the market while it seemed that the circumstances were provided for an upward rally in TSE. What has always been interesting regarding the market is the unpredictability feature that is the indispensable component of all equity exchanges and TSE is by no means an exception. Bearing this in mind, there are some causes that end in effects we saw during past trading days including today:
- The market has this misrepresentation that what happened when the preliminary agreement was signed and then after that different interpretations were inferred from the factsheet might be repeated again. The notion of similar prediction- pattern error comes up here. Thus, Market practitioners construe that this deal might not be finalized as there are some pertinent risk hovering around it.
- Another element of less significance is related to the low amount of dividend ratio distribution in the banking sector which is presumed to be way less than it used to be. Comparing the average 50 percent cash dividend to that of around 10 percent in accordance with CBI’s directive prompted some stockholders of the banks in question to relieve themselves of these low-paying equities.
- Plus the resulted decline in prices goes back to the disappointing reaction and performance of the legal persons which own 75 percent of the current transactions in the exchange market.
- Last but not least, we should mention that the general assemblies of some remaining companies especially the banking category need to be held, as July 22 is the last available and permissible date for companies listed in Tehran Exchange Market. This in turn added to the selling pressure albeit the historic and memorable deal in Vienna.
To put it into a nutshell, there is not any imminent systematic risk that we could argue about and what we see is a passing fad and practitioners of the market should analyze the current conditions in a non-affected mode and attitude and of course with open-mindedness as there is a brighter future awaiting for those investors not taking their decisions based on rapid momentum and extremely fake excitement.
TSE at a Glance
Summary of Trades
IFB at a Glance
Trading Halts & Delays
As we already mentioned above, the down-surge in prices and the overall index is not something of big importance to worry us that much to wonder why the capital market did not respond as was expected. But with the new political climate, which clouds around our economy, we can ensure there are good days ahead of us to rejoice the fruits of the big deal of the century. We should always keep in mind that patience always pays off and with the new era in our relations with foreign countries and especially p5+1, the conditions are already well-provided for better GDP that would in its turn impact the overall economy and trade-off between Iran and the outside world.
DISCLAIMER: This report has been prepared and issued by Agah Brokerage Firm on the basis of publicly available information, internally developed data and other sources believed to be reliable. The information contained herein is not guaranteed, does not purport to be comprehensive and is strictly for information purposes only. Agah does not assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions. Any expressions of opinions are subject to change without notice.
To contact the reporters: Negar Moshirfatemi at firstname.lastname@example.org