Stocks at Tehran Stock Exchange (TSE) wavered between gains and losses on Monday’s trading; with unsettled investors remaining cautious amid ongoing lingering ambiguities surrounding the economy and the performance of listed companies.
It has been a while since the benchmark last hovered around 75,000-points mark, with the overall index posting tiny surge at the end of trading hours.
The TSE witnessed a bumpy trading day on Monday, with most of the indices ending in green territory.
The TEDPIX edged up 11.3 points or 0.02 percent to stand at 65,556. The first market index notched up 4.2 points or 0.01 percent to end at 48,288. The second market index rose 50.3 points or 0.04 percent to 128,959.3. The free float index pulled higher 99.6 points or 0.13 percent to settle at 74,562.7. The industry index was up 11.7 points or 0.02 percent to 54,904.1, and the blue chip index was down 0.4 point or 0.01 percent to end at 2,939.8.
In a seesaw trading day, close to 48 percent of the listed firms posted tiny gains, and positively contributed to the TEDPIX, however almost 44 percent negatively weighed on the benchmark, with the rest of companies ending flat.
Mapna Group, Ghadir Investment Company along with Mobile Telecommunication Company of Iran had the most contribution to the TEDPIX’s uptrend; however Pension Fund, Islamic Republic of Iran Shipping Lines, and Eghtesad Novin Bank scrambled to drag down the benchmark.
Trade Value on the Rise
Since January 5, the TSE has managed to stage a tangible lift in trade value. It has been a while since floppy trade at the IME was last accompanied by low trade volume and value, though it might be considered as a sign of bears hibernation at the equity market.
According to TSE data, more than 774 million shares changed hands, valued at almost 2 trillion rials, which indicate close to 100 percent surge in trade value.
Despite the fact that speculations about that the equity market have been buoyed by block trades, and potential manipulation of the benchmark, the TSE’s overall index has the potential to dramatically soar, and register new record highs once western sanctions over Tehran’s nuclear energy program are lifted.
Manipulation of the Benchmark
The TSE sentiment has cooled down since January 24, mostly due to the block trades within the final trading hours, which raised speculations over manipulation of the benchmark.
Some market analysts have recently criticized possible manipulation of the overall index amid block offerings of the companies, which considerably impacted the TEDPIX, stressing that the benchmark value is not precisely reflecting the equity market’s atmosphere. However, Mohammad-Reza Khajeh Nasiri, exchanges and markets supervision director at the Securities and Exchange Organization (SEO) is against the assumptions, saying: “Block trades performance is normally conducted in compliance with institutional investors accords and is part of the equity market’s function.”
Speaking with Hamshahri daily, Khajeh Nasiri declared that hoards of securities are regularly being transferred to individual investors, adding that: “When market depth is lingering in low levels, the impact of block trades will be strongly apparent.”
Market depth is closely related to liquidity and volume within a security, but does not mean that every stock showing a high volume of trades has good market depth.
“At a time of gloom in the equity market, various triggers should be taken into the consideration in a bid to raise the trade volume, value, and block trades,” Khajeh Nasiri noted.