Interest Rate Cut While Market Rise?
- In addition to its importance in the banking structure, market experts hold the belief that the lowering of the interest rate on bank deposits to 15%, to be formally executed from tomorrow, will contribute to the rise of the market p/e ratio on one hand and reduce companies’ financial cost on the other; this has the potential to eventually increase companies’ gross profit and therefore, lead to the capital market boom. Unfortunately, the volume and value of trades has fallen sharply in comparison with the period after the JCPOA struck. Referring to the recent fallings in the all-share index, such experts blame technical analysts whose financial decisions have led to the formation of a short term investment horizon among investors. Market activists assume that under the current situation, creating motivation to attract money to the capital market and pull it out from recession is a necessity, which was formed through setting tax exemption law, especially VAT. Such instruments are known to kick start demand on one hand and prevent the formation of a bubble on the other.
- After the announcement of selling 73% of Zob’s stake by Iran and the Steel Pensioners’ Fund for retired Iranian Steel Workers, while also planning to boost its production, an aware source has stated that companies from South Korea and Luxemburg have expressed interest in buying a part of Esfahan Steel Company’s (Zob) shares.
- Daroupaksh Pharmaceutical Ingredients Company has submitted its request to raise its capital by 200% mainly based of its shareholders’ paid-in capital and claims due. This plan is targeted to improve and upgrade the product line, launch new product lines as well as financing the required working capital.
In the Market
Most tickers in the Automotive sector closed below their flat lines. With more than 90 mn shares changed hands, Saipa (Khesapa) closed at IRR 1,097 (-2.23%); it topped the sector and the whole market in terms of the highest volume traded. The trend followed by Iran Khodro as well. 32.08 mn shares of the giant traded today led to a near flat line closing. “Khemehvar” tried to compensate a little but the volume was not considerable. Other names were traded mostly in red.
Rather balanced trades were seen among most tickers in the Banking industry. Following the previous news on the positive EPS adjustment, Bank Day was in high demand in today’s early session. However, the bear dominated the market, made trades lethargic and result in 1.86% decline in closing price. More than 9 mn shares of Mellat Bank traded and the ticker closed at IRR 2,160 (+1.12%)
Signals in the Metals sector were mixed today. On one hand negative trades surrounded “Foolad” and made the closing price fell as low as IRR 1,130, and on the other “Foroos” ended the session with more than 50,000 buy orders in the queue. Almost all steel producers (Khouzestan Steel, Isfahan Steel, …) were among the big losers today. There is no other well-known catalysts behind the disappointing trend in the sector than before.
Finally, TCI was the sole positively influential ticker, tried to compensate for TEDPIX. Communication giant raised the index 38.18 points and closed at IRR 2,080. TCI is the 3rd on TSE, in terms of Market-Cap.
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