Tehran Stock Exchange tumbled into correction territory Sunday as an unimpressive economic picture sparked a retreat by investors and traders hesitant to enter the week with big bets as in the past.
The second straight negative trade for the market came as investors do not hold the prospect of better income results for companies at the end of the calendar month on December 22. The correction in prices was accompanied by a drop in the volume of trade as liquidity flows out of the market.
A surging rial and the growing uncertainly resulting from renewed US sanctions has dampened investor sentiment with the outlook for commodity and export companies looking bleak. The majority of industrial companies' share values continued to drop on Sunday while 75% of all stocks were in the red.
The selloff pressure in mineral and metal companies also spilled over to banks stocks which had been among the few bright spots in the market in the past days.
The US dollar was traded around 990,000 rials on Sunday before climbing back to above the psychological level of 100,000 rials later in the day.
The rial jumped to 105,500 against the US dollar last week from 152,500 at the end of October.
It is apparent that the rial’s much-awaited rebound, from record lows around 190,000 to the USD in late September, is good news for a government that is struggling to overcome the US sanctions.
Farhad Dejpasand, minister of economy and finance said on Sunday that the foreign exchange market is moving toward "moderation" as more currency is supplied by exporters and the central bank manages the demand side.
Indexes Performance
The Tehran Stock Exchange main index lost 2,777.82 points or 1.69% on Saturday to end trading at 161,708.1.
About 1.5 billion shares valued at roughly 4 trillion rials ($39.21 million) changed hands at TSE for the day.
Trading at TSE and over-the-counter Iran Fara Bourse starts on Saturday and ends Wednesday.
Amin Pharmaceutical Company was the biggest winners as its shares went up 9.98% to 2,865 rials.
Pars Animal Feed Co. incurred the biggest loss among all TSE-listed companies and went down 4.99% to 8,189 rials per share.
Golgohar Mineral & Industrial Co. contributed the most to the benchmark's fall, followed by Mobarakeh Steel Company and Persian Gulf Petrochemical Industries Company.
MAPNA Group - a conglomerate involved in development and execution of thermal and renewable power, oil & gas and railway transportation–gave the biggest boost to the benchmark index, followed by Kharg Petrochemical Company and Iran Chemicals Industries Investment Company.
The Price Index lost 807.45 points to close at 47,007.8.
The First Market Index was down 2,234.07 points to post 118, 960.9. Second Market Index decreased by 4,621.91 points to reach 322,961.1.
The Industry Index went down by 2,450.20 points to register 146,896.8. Free Float Index was down 0,035.84 points to hit 173,456.32.
TSE 30 went down 160.83 point to settle at 7,925.5 and the TSE 50 ended 131.13 points lower to finish at 7,005.9.
Caption: About 1.5 billion shares valued at roughly 4 trillion rials ($39.21 million) changed hands at TSE on Sunday.
