The government’s renewed pledge to support the stock market helped boost investors’ sentiment after share prices plunged in recent days.
The benchmark of Tehran Stock Exchange, TEDPIX, lost close to 6% in the past three sessions before coming back on Wednesday after the government said it was expediting measures announced earlier to revive the long-battered market.
TEDPIX gained 21,441.90 points or 1.78% on Wednesday to end trade at 1,229,368. The rally was led by large caps while most small caps are still under sell-side pressure.
The TSE-30 Index gained more than 2.9% while the TSE’s equal-weighted index was up almost 0.5%. The former index tracks the performance of top 30 companies in terms of market cap while the latter gives the same weight to all shares.
Investor sentiment buoyed after the Economy Minister Ehsan Khandouzi said the government has decided to bring forward the enforcement date of support measures approved in late December.
As part of the 2022-23 budget, the measures were initially planned to be enforced in March 2022 marking the beginning of the Iranian New Year. The government officially announced the decision on Wednesday, saying they must be enforced without further delay.
Adjusting gas feedstock prices to listed manufacturing companies, injecting the entire tax income from trading shares into the stock market via the “stabilization fund” and reducing tax rates on manufactures listed on Tehran’s share market by 5 percentage points (from the previous 25%) are among the key decisions.
As per another decision, the foreign exchange parity rates are to be increased substantially, which is expected to improve the financial performance of 18 banks listed on the bourse.
Accordingly, the parity rate will increase by up to 90% of the currency rates quoted at the secondary foreign exchange market known as Nima, an online platform where exporters sell their overseas currency income and companies buy for import.
Market Performance
At the close of Wednesday’s session, 280 tickers gained and 183 tickers lost, showing that gainers accounted for 58% of the tickers.
Retail trade declined 13% compared with a session before to reach 32.2 trillion rials ($115 million), accounting for 65% of the total trade.
About 5.95 billion shares valued at 38.74 trillion rials ($138.4m) changed hands at TSE for the day.
Kourosh Food Industry Company contributed the most to the benchmark's fall, followed by Esfahan Steel Company, Iran Tractor Manufacturing Company and Razak Pharmaceutical Company.
Mobarakeh Steel Company gave the biggest boost to the benchmark index followed by National Iranian Copper Industries Company, Persian Gulf Petrochemical Industries Company and Ghadir Investment Company.
The main gauge of Iran Fara Bourse, IFX, gained 79.37 points or 0.47% to close Wednesday trade at 17,035.25.
About 2.25 billion shares and securities valued at 17.3 trillion rials ($61.8m) were traded at the junior exchange for the day.
Minoo Industrial Group Company, Damavand Power Generation Company, Kowsar Insurance Company and Iran Fara Bourse had the most negative impact on IFX.
Zagros Petrochemical Company gave the biggest boost to IFX, followed by Shahid Tondgooyan Petrochemical Company, Lavan Oil Refining Company and Hormozgan Steel Company.
