Market News

The economy’s skeleton key; Filed!

Liquidity shortage is the dilemma made both markets and key players captive in the recent years. Deficit is to amend by the major four economy drivers:

• Government Investment;
• Foreign Investment;
• Money Market, and
• Capital Market

Despite the fact that the first three are in limits for now, it seems the 6% share for capital markets to compensate for all is drastically low. Debt market development shall reduce the pressure on banks and public sector. Not to mention that non-inflationary growth of liquidity leads to higher multiplier.

Below, debt market cap to GDP ratio, has been examined for 15 economy pioneers and figures stressing the fact that there is a long road for Iran to be level with international peers.

The ratios prove that Iran debt market has been ornamental till now. Defiance to positive economic changes and the resistance of non-developed market beneficiaries are to blame for the under achievements.

Should the expansion of said markets be advantageous to emerging’s like Iran in the following ways:

• Increasing economy efficiency
• Reducing the vulnerability to financial crisis
• Alleviation of financial crisis aftermath
• Availability of alternative finance sources to firms (When banks have hands tied)
• Increasing Financial transparency
• And …

The administration is decisive to develop the market. In 2016, IRR 50,000 bn Musharaka Sukuks for oil ministry, IRR 100,000 bn for other ministries related firms, IRR 50,000 bn directly for government, IRR 70,000 bn municipal Musharaka, IRR 75,000 bn T-bills with one to three years maturity and IRR 125,000 bn of settlement securities (GOV) T-bills are to be issued and yet it is still not fulfilling the available capacity.

In the Market

The stock market started an upbeat week from yesterday, on a flat note as the major PetChems began to rally over the new highs in oil price. TEDPIX rose more than 320 points (+0.51%) to stand on 74,194.80.

Additional focal points impacted today’s trade included a rebound in the Auto giant’s, Saipa, share price. In the early absence of the old rival, IKCO, near 95mn shares of “Khesapa” traded on today’s session and the ticker closed at IRR 1,277 (+4.24%). The trend over the industry were mostly positive. Rumors on new contracts to be unveiled today is the main catalysts behind the 360 rotation. “Khodro” reopened after the GA being held, and closed @ 3,135 (+1.00%).

PetChems began the day on a higher note, with hefty orders sitting in the buy queues, as the rising oil price hand in hand with lower feedstock fees carved out fresh all-time highs for a great deal of industry tickers. Parsian Oil and Gas marked the most positive effect on the index with 82.73 points. Arak petrochemical followed the trend but with much lower traded volume.

Refineries outperformed in the oil products space, evidenced by 4-5% gains in almost all the tickers. More than 22 mn shares of Bandar Abbas oil refinery were traded today. The ticker placed second with 72.77 positive point effect on TEDPIX.

Rather balanced trades were dominated amid the banking sector. More than 54 mn shares of Mellat bank traded on + 1.56%. Tejarat and Pasargad trades placed in green as well. Saderat on the other hand lost about 0.2% of its share value and traded for 125 mn.

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. 

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