Economy, Business And Markets

Stocks Rally But Mood Remains Fragile

Stocks Rally But Mood Remains Fragile
Stocks Rally But Mood Remains Fragile

Tehran Stock Exchange continued its upward trend on Tuesday and the market’s benchmark edged up 0.06 percent, while the investors remain in skittish mood.

The TSE main index (TEDPIX) was up 40.5 point or 0.06 percent preserving its gains. The second market index rose 278.1 points or 0.2 percent to 52,678.2. The free floating index finished higher by 69.7 points or 0.09 percent to 80,780.9. The industry index climbed 55.6 points or 0.09 percent to 60,807.5, while the first market index and the blue chips failed to contribute to the market’s upward trend, according to the TSE website.

The first market index shed 1.3 point to 52,678.2 and the blue chip index slipped 1.1 point or 0.03 percent to 3,302.3.

More than 258 million shares changed hands, demonstrating almost 95 percent decrease compared Monday. Besides, trading value hit the bottom and dropped to 605 billion rials.

The Parsian Oil and Gas Development Company was the most gainful trades for the investors as well as the main contributor to help to lift the TEDPIX by 14.99 percent. The Tamin Pharmaceutical Investment Company and Alborz Investment Group stood next to the POGDC and pushed the TEDPIX to green by 11.66 and 5.6 percent respectively.

The TSE stood in green to notch its 4th straight session of gain. Still, some of the shaky investors prefer to hedge their bets, bouncing between selling off risk at the first hint of trouble and seizing bargains when things calm down.

Nuclear talks are the most crucial factor to the equity market’s gauge sentiment. Any disagreement among parties –Iran and the P5+1, will spurn concerns over the prospect of the government’s plans to tackle the slumped market.

The government is serious to tackle the capital market challenges with the plan of action to exit recession. Besides, the Securities and Exchange Organization’ strategic plan to boost market liquidity and simultaneously bolster the equity market, is another concrete step to change the stock market’s negative trend in past six months.

The TSE is trying to shrug off concerns over the nuclear talks, as uncertainty reigns over the outcome of the talks and nobody knows whether Iran and the P5+1 will agree to a long term.

Nuclear talks should not have an effect on market trends in the short term , even if the country is behind the ongoing negotiations with the foreign powers, the country has to continue on its path of market liberalization.

Using adaptive mechanisms to boost the market’s liquidity and providing funds for businesses, pushing for transparency in leading companies’ contracts, as well as the cutting banking interest rates will lead the economy on a safe path.