Tehran Stock Market roars further!
Market News
– The TEDPIX finished the first quarter of 2017/18 with a 13% rise; the Tehran Stock Market registered an 8.9% growth over the past week (16-22 June), which names this week as the highest-yield week of the past few years. While it had failed investors until 2 weeks ago with only a 5.13% yield, when compared to the 59% return in the gold market, the Tehran Stock Exchange managed to break records in 6 consecutive sessions and brought about a 3.2% daily return for shareholders; over the said period, the average daily trading value has gone through a 4 times rise to exceed IRR 4,440 bn (USD 104.68).
The main driver of this growth must be sought in fluctuations in the foreign exchange rates, which adopted an ascending trend following the stock market decline since the beginning of 2018; this movement, unfortunately, turned the forex market into a rival for the stock exchanges in the short term and considering the USD/IRR effect on the gold coin prices, it dragged money further away from this market.
– The Iranian tax administration is to stand against day traders and speculators of FX and gold markets by imposing high-level taxes on their transactions after all. Following a presidential order issued by Rouhani’s administration, in the first step, the buyers of gold coin pre-sale scheme shall be identified and file for VAT and income taxes. A similar approach is going to be taken for FX, auto and housing markets which altogether have created chaos over the entire economy atmosphere.
In the Market
The stock market started the week on a positive note by advancing 0.49% in today’s session. Energy shares led the broad-based rally thanks to a spike in oil prices, which surged to a four-week high as OPEC wrapped up its latest summit in Vienna. The Oil Products (+ 2.27%) tickers were highly demanded, leading names to face buy massive queues.
Despite its weak performance over the past weeks, the first day of this week saw liquidity moving from commodity-based shares towards the Automotive space with Saipa (SIPA1, + 4.89%) and Iran Khodro (IKCO1, + 4.96%) having a say in the TEDPIX growth. Analysts believed that the sector still lacks fundamental drivers and short-term speculations are only expected.
Following the confirmation of the 20% increase in coal prices, the Coal Extraction space, i.e. Tabas Coal Processing and Shomal-e Sharq Mineral and Industrial companies finished with buy queues.
Regardless of heavy sales pressure in the first half of today’s session, Iron Ore (+ 0.57%) space entered the green zone in the final hour. Chadormalu Mining & Industrial (CHML1, +2.63%), Saba Nour Mineral (KNRZ1, +1.63%) as well as Damavand Mineral (DMVN1, 2.28%) closed with buy queues.
Finally, except a few such as Middle East Mining Industries (KHMZ1, +4.99) and Esfahan Steel (ZOBZ1, +4.99%), the Metals (-0.98%) industry mostly finished in the red. However, analysts believed that today’s break was only a profit realization and the sector’s mid-term growth is guaranteed.
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