Economy, Business And Markets

TEDPIX Edges Up on Tentative Interest Rate Cut

TEDPIX Edges Up on Tentative Interest Rate CutTEDPIX Edges Up on Tentative Interest Rate Cut

The Tehran Stock Exchange (TSE)’s benchmark ended a seesaw trading day in green following news about a possible cut in interest rates from 22 percent to 20 percent, coupled with positive contribution of banking sector and National Iranian Copper Industries Company (NICIC). However, some giant firms underperformed and trimmed earlier gains during the final hours of Sunday trading.

Bandar Abbas Oil Refining Company extended its massive retreat and topped market laggards. Telecommunication Company of Iran, and Persian Gulf Petrochemical Industry Company with almost 38 and 30 points stood after the BAORCO.

TSE data showed that the TEDPIX inched up 4.7 points or 0.01 percent to stay at the edge of green territory. The first market index gained 8.4 points or 0.02 percent to end at 49,402.3. The second market index slides 21.7 points or 0.02 percent to stand at 134,035.3. The free float index rose 138.4 points or 0.018 percent to settle at 78,188.9.  The industry index lost 74.5 points or 0.13 percent to 55,111.4, and the blue-chip index pulled up 1.6 points or 0.05 percent to 3,132.6.

Sunday’s choppy trade at the TSE recorded about 40 percent decline in trade volume, with close to 776 million shares changing hands. Trade value also retreated around 35 percent to fall to 1.38 trillion rials.

Tejarat Bank with 218 million shares registered the highest trade volume among the listed firms at the TSE. Saderat Bank and Pars Khodro followed Tejarat Bank.

The NICIC with almost 56 points in positive contribution had a pivotal role in the benchmark’s uptick. Esfahan Oil Refining Company and Tamin Petroleum & Petrochemical Investment Company also with 35 and 29 points took the second and third place respectively.

 IFX Ticks Up

Meanwhile, more than 207 million shares changed hands at Iran Farabourse or over-the-counter, valued at close to 293 billion rials, which was accompanied by the IFX’s tepid surge, Farabourse reported.

The IFX crept 4 points to reach 757. Most Exchange Traded Funds also gained on Sunday. The highest trade volume was registered for ‘Gostaresh Tejarat’, an affiliated company of Iran Khodro – Iran’s pioneer auto manufacturer.

According to the report, Esfahan Steel Company, Hormozgan Steel Company (HSC), as well as Gosteresh Tejarat Company had the highest surge in their shares’ value.

Tehran Oil Refining Company, Niroo Sarmayeh Company and Taknar Company had lackluster trade due to the huge cut in their share value.

The HSC is a newcomer at the equity market, and its Initial Public Offering was held a few days ago. It yielded a return of 36 percent just within eight consecutive trading days. The company managed to beat previous expectations about its performance at the stock market.

Despite gloomy outlook for the HSC’s performance, due to lackluster IPO of the steel manufacturer, which stoked concern among both individual and institutional investors, the company dramatically outperformed.  

 Bond Market in Review

More than $512 million worth of bonds were issued during the past Iranian year, which ended March 20, SENA reported.

Close to $235 million of fixed-income participatory bonds, which account for 49 percent of overall non-governmentally sponsored bonds, were among the most demanded bonds in Iran’s equity market.

Rental bonds worth up to $216 million, accounting for 45 percent of the total bonds issued, stood after the fixed-income participatory bonds. And, more than $30 million worth of Murabaha bonds, accounting for up to 6 percent of the total bonds issued, followed rental bonds.

Murabaha bond is an Islamic financing structure, where an intermediary buys a property with free and clear title to it. The intermediary and prospective buyer then agree upon a sale price (including an agreed upon profit for the intermediary) that can be made through a series of installments, or as a lump sum payment.

According to the report, seven investment banks have been engaged as the bonds market makers, among them, Parsian Lotus Investment Bank has underwritten up to 31 percent of overall bonds’ value. Omid Investment Bank and Amin Investment Bank with 22 and 16 percent took the second and third place respectively.