Mirroring macroeconomic conditions of the country under different circumstances, the capital market recent growth is in direct relation with the growth in different sectors such as Automotive and Contracting, as well as the broken out positive news and the new inked agreements in the post-sanctions era. In this regard, market practitioners have identified 4 factors for the market’s ascending trend in this year.
First of all, they refer to the capital market growth dependence on other variables, including global prices of commodities such as oil and iron ores. Experts claim that more than half of the listed companies are dependent on global prices, directly or indirectly. The falling of such prices in the last 2 years has made about 50% of the listed companies in the market say goodbye to their leadership roles. The current increase is capable of moving the capital market upwards.
As the second factor, they name the domestic economic growth. In fact, if the predicted 5% economic growth is realized, companies will be able to sell and export more of their products, making more revenue and enjoying higher profit margins and return which in the long term can benefit shareholders.
As they go on, they mention the structural modifications in some economic sectors, including banks and financial institutions as the third factor; if occurred, they can significantly affect companies’ improvement by raising their trading volume, which has the potential to positively influence their EPSs.
Last but not least, they point out to the entrance of foreign capitals into the market, which can be highly influential in the market growth, adding to the market depth.
In conclusion, they referred to the recent trading sessions where the TEDPIX ended in the red, stating that such corrections seem natural among those sectors which have outgrown their actual capacities and those sectors which have enjoyed practical positive changes and events will continue to face the chance for more long-term growth.
- Announcing 2 cents, as the feedstock price, to be applied from the beginning of the current year, an authority in Oil and Gas Ministry stated that petrochemical companies will now be able to calculate and release their financial statements. Stressing the importance of such a price, he also mentioned that high degree of caution must be taken when identifying the used formulation’s parameters since it directly affects companies’ profitability.
- As the financial manager of the Electricity Meter Mfg. Company has announced, the respective company has managed to cover 94% of its predicted EPS for the FY ended 19 March 2016. Mr. Bahrami also added that the company has planned to raise its capital in 2 phases such that it will increase by 125% in the first phase mainly based on revaluation of their fixed assets while the second phase will be done relying on the retained earnings and claims due.
In the Market
Negative trades were seen among names in the Automotive sector. Iran Khodro Company witnessed a sell-off and shed 4%. It eventually closed with a 13 mn share sell queue; besides, it topped the sector in terms of the highest volume traded after 63 mn shares changed hands. Saipa Company also ended in the red and after trading more than 14 mn shares, it dropped 3%. The negative atmosphere in these 2 shares spread to other symbols such that Pars Khodro Company also went down by 3% and faced a 6 mn share sell queue after 14 mn shares transacted. Zamyad Company, Bahman Group and Saipa Diesel Company were among those which also closed with sell queues. As the Minister of Economy and Financial Affairs has predicted, Iran’s economic growth in the current year will exceed 6% and the Automotive sector will be one of the front runners in this growth.
Most tickers in the Metals space went through positive trades. Despite starting the session in a positive range, Esfahan’s Mobarake Steel Company ended in the -0% area; after trading more than 106 mn shares mainly by institutional investors, it topped the sector in terms of the highest volume traded and gained 1% at the end. Hormozgan-e Jonoub Steel Company and Iran Pipe and Machineries Mfg. Company also faced buy queues. However, Esfahan Steel Company dropped 0.95% and ended with a 4 mn share sell queue.
Most names in the Chemicals industry traded beneath their flat lines. Tamin Petroleum and Petrochemical Investment Company was crowned as the highest volume traded share after trading more than 14 mn shares; according to statistics, more than 83% of this volume was traded among institutional investors. Persian Gulf Petrochemical Industries Company was placed next. Nirou Chlor Company and Pars International Products Company hit their highs, despite trading in low volumes. Farabi Petrochemical Company and Pakshoo Industrial Company ended with sell queues. In its latest projections, Maroon Petrochemical Company has predicted to make a $0.13 EPS for the FY ending 19 March 2017, demonstrating a 23% decline.
Balanced trades were seen among symbols in the Oil Products affair. After two negative trading sessions, Bandar Abbas Oil Refining Company started the session in a positive range and after more than 10 mn shares changed hands among individual shareholders, it led the group in terms of the highest traded volume. Shiraz Oil Refining Company was the only name facing a buy queue; it eventually grew up 4% with no tangible movement among its institutional investors. Lavan Oil Refining Company shed 2.5% and ended the session with no sales by its institutional shareholders.
Finally, despite institutional support, there is still a negative atmosphere in the Banking sector. Only Bank Sina, Post Bank and Bank Karafarin ended above their flat lines, in +0% area. Bank Mellat fell by 4% after more than 35 mn shares changed hands, topping the sector. According to the news, all banking operations can now be done in three branches of Bank Mellat in Ankara, İzmire and Istanbul. Hitting its low, Bank Parsian’s authorities have announced the bank’s plan to raise its capital up to $1,438.15 mn. Besides, an authority in Bank Tejarat announced English Banks’ reluctance to have correspondent relations with Iranian banks, afraid of being targeted by the U.S sanctions, causing difficulty for normalization of trades among Iran and England.
TSE at a Glance
Summary of Trades
TSE Major Sectors’ Daily Performance
Trading Halts and Reopenings
IFB at a Glance
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