The prevailing recession coupled with cash flow issues kept draining Tehran Stock Exchange on Tuesday with dramatic retreat in daily trade volume and value.
Close to 294 million shares changed hands valued at $15.9 million to illustrate TSE’s dented sentiment amid lingering ambiguities hanging over the state of economy, which has curbed investors’ enthusiasm to buy shares that are even below their intrinsic values.
Despite lucrative average PE ratios and optimism on Iran’s economic outlook by early 2016 upon the lifting of western sanctions, unsettled investors are balking at engaging in the equity market.
After ending five consecutive days in green, TEDPIX pulled back 6.7 points or 0.01% to end at 64,511.7. The Price Index shed 2.7 points or 0.01% to close at 25,502.2. The First Market Index slipped 40.2 points or 0.09% to stand at 45,755.9. The Second Market Index gained 180.9 points or 0.13% to settle at 137,761.9. The Free Float Index perked up 5.77 points or 0.01% to reach 73,047.8. The TSE 30 Index was down 2.5 points or 0.09% to end at 2,852.2; and the TSE 50 Index edged down 1.5 points or 0.06% to stand at 2,646.1.
Once again, most of the listed companies weighed on the benchmark with National Iranian Copper Industries Company leaving the most negative impact on TEDPIX. The company with a PE ratio of 5 and -20 points topped TSE laggards followed by Bank Mellat and Tamin Petroleum & Petrochemical Investment Company with -14 and -9 points respectively.
Islamic Republic of Iran Shipping Lines with 18.2 points gave the biggest boost to TEDPIX. Bank Tejarat and Middle East Bank with 10 and 7 points took the second and third place respectively.
IFX Settles in Green
Iran Fara Bourse’s overall index reversed its downtrend and picked up 2.35 points or 0.32% on Tuesday to stand at 725.99.
More than 93 million securities traded worth $58.76 million to record a dramatic surge in trade value.
Bank Hekmat with 2.93 million shares recorded the biggest daily trade volume. The highest daily trade value was registered for Iran Cultural Heritage and Tourism Investment Group Company.
The newly debuted shares of Lia Company at IFB recorded the highest rise in value. Minoo Group, Niroo Sarmayeh Company and GTS Iranian Company retreated the most.
Ganjineh Ayande Roshan Fund with 560,000 transactions topped daily trade volume among listed exchange-traded funds. The highest trade volume in fixed-income market was recorded for 200,000 leasing bonds.
Equity Market a Mirror of Economy
The overall performance of the economy is tied to the global raw commodities market and hence listed industries at the equity market are linked to this market, SENA quoted head of Securities and Exchange Organization, Mohammad Fetanat, as saying.
Lack of liquidity, dramatic decline in the government budget allocated to construction projects, cash flow problems and the lingering sanctions [imposed by the West on Iran over its nuclear energy program] have also dramatically squeezed the economy, said Fetanat.
“Once sanctions are phased out in early 2016, the capital market is likely to gradually get back on track,” he predicted.
