The Tehran Stock Exchange overall index wrapped up the week after a bumpy ride with tiny gains, however, intensifying tensions in the region, ambiguities sorrounding the lingering sanctions over Iran’s nuclear energy program along with the liquidity crunch kept fretting the investors.
According to TSE data, the TEDPIX notched up 172 points or 0.27 percent in the week that ended May 20 to stand at 63,703, snapping 5 weeks of downbeat performance.
The first market index rose 141 points or 0.31 percent to reach 46,075. The second market index was up 246 points or 0.19 percent to settle at 130,741.
Around 1.5 million shares changed hands in a floppy trading week, valued at about $95.7 million to post 54.9 and 59 percent decline in trade volume and value respectively.
Close to 622,200 participatory bonds changed hands, valued at a total of $1.96 million, indicating 44 and 44.3 percent retreat in volume and value respectively compared to the prior week.
The mining industry, with 8.28 percent and communications with 5.46 percent were the leading gainers. Leather, tire and plastic industry came next.
Massive Monthly Retreat
The TEDPIX nosedived 3,314 points or 4.94 percent to end at 63,703.1 in a one-month period ending May 21. The first market index shed 3,003 points or 6.12 percent to 46,075.6. The second market index plunged 2,951 points or 2.21 percent to 130,741.2. The free float index 4,546 or 5.85 percent to settle at 73,152.5. The industry index plummeted 2,580 points or 4.7 percent to 52,325.8. The financial index plunged 8,956 points or 6.15 percent to 126,706.1, and the blue-chip index also was down 196 points or 6.29 points to drag to 2,919.1.
Trade volume and valued dramatically slumped, with about 12.1 trillion shares changing hands, valued at $724.8 million to post 55 and 34 percent decline in volume and value respectively compared to the previous trading month.
New Transparency Measures
As of today May 23, all listed companies will be mandated to directly file their information via the CODAL system (comprehensive database of all listed companies) without involvement of any intermediary agent, and companies will be responsible for any probable mistake within the reports which may mislead investors.
Moreover the Securities and Exchange Organization has loosened the equity market’s limit up/ down price band, to enhance transparency through listed companies’ monthly reports.
Furthermore, launching Initial Public Offerings at both the TSE and the Iran Fara Bourse is postponed to late June as gloom keeps hanging over the stock market.
Finally, Iran’s equity market will no longer witness Initial Public Offerings (IPOs) except in accordance with the book building process, which aims to fix the highest market price for shares and securities, increase transparency in allocations to the investors and reinvigorate the equity market.
All the above mentioned measures have been taken with the aim of preventing massive retreats at the equity market through enhancing transparency.
The expectations about the TSE’s sentiment in the upcoming months differ widely, with some market analysts projecting a grim outlook, while others refer to massive devaluations and indicate that challenges faced by the TSE are likely to fade away once Iran and the P5+1 reach a nuclear accord.
