Tehran stocks gained 32,000 points at the close of trading week on Wednesday to push the benchmark of Tehran Stock Exchange 3.8% higher.
The market saw a highly rewarding week with daily gains of above 3% on average amid professional investors and market analysts’ worries about what lies ahead and growing enthusiasm by novice investors to get a slice of the growing pie.
Commodity stocks and shares of banks and auto companies were the main drivers of the rallies in the past two weeks despite collapsing international oil prices and a prolonged downturn in the base metal market.
According to the Donyaye Bourse website, the key factor boosting the stock market is not the earnings of listed companies, but the flood of liquidity from the unusually growing number of investors.
Worried about the strange growth in market indicators, Fardin Aqabozorgi, a stock market broker, warned that share prices will undergo a major correction in the near future.
He reckoned a combination of huge losses incurred on businesses due to coronavirus and mounting restrictions on foreign trade due to the US sanctions, as factors threatening the economy, and by extension, the performance of listed companies, Bourse Press reported.
Surge in foreign currency prices against the rial is another major factor pushing the stock market up. Besides creating inflationary expectations, the soaring value of the dollar could help export-oriented listed companies earn more when their earnings are converted into rials.
Market Performance
The TSE's main index TEDPIX gained 32,150.41 points, or 3.80%, on Wednesday to end trading at 878,102.39.
About 5.15 billion shares valued at 78.47 trillion rials ($503.04 million) changed hands at TSE for the day.
Trading at TSE and over-the-counter Iran Fara Bourse starts on Saturday and ends Wednesday.
Industry and Mine Leasing Company was the biggest winner as its shares went up 22.09% to 11,025 rials per share.
AzarAb Industries Company incurred the biggest loss among all TSE-listed companies and went down 3.59% to 34,787 rials per share.
AzarAb Industries Company contributed the most to the benchmark's fall, followed by Darou Pakhsh Pharmaceutical Chemical Company, Mashhad Wheel Manufacturer Company and Derakhshan Tehran Industrial Company.
Persian Gulf Petrochemical Industries Company gave the biggest boost to the benchmark index, followed by National Iranian Copper Industries Company, Mobarakeh Steel Company and Social Security Investment Company.
The Price Index gained 8,553.10 points, or 3.80% to close at 233,611.04. The First Market Index increased by 21,046.39 points, or 3.50% to post 622,853.34.
Second Market Index went up 75,260.85 points, or 4.22% to reach 1,856,667.15.Industry Index was up 29,558.86 points or 3.97% to register 773,533.63. The Free Float Index was up 39,875.24 points to hit 1,104,634.72.
TSE 30 went up 1,397.01 points to settle at 35,786.64 and the TSE 50 ended 1,260.76 points higher to finish at 32,638.68.
IFX Up 3.51%
Iran Fara Bourse main index, IFX gained 348.46 points, or 3.51% to close Wednesday trade at 10,289.44.
About 2.39 billion securities valued at 43.06 trillion rials ($276.06 million) were traded at the over-the-counter exchange for the day.
Jahrom Power Plant Development Company had the highest number of trade as 285.27 million of its shares worth 1.66 trillion rials ($10.7 million) were traded.
Kowsar Insurance Company and Parsian Railway Transport Development Company had the most negative impact on IFX.
Middle East Mines and Mineral Industries Development Holding Company gave the biggest boost to IFX, followed by Saba Tamin Investment Company, Shahid Tondgooyan Petrochemical Company and Esfahan Steel Company.
