Tehran Stock Exchange witnessed poor performances by major sectors this week.
The TSE all-share index slipped by 1.2%, closing at 61,421 and recording the lowest index measure since October 2015. The TEDPIX has mostly been affected by a 7% drop in the oil products sector.
On the other hand, sugar companies have been the investors’ alternative choice, adding 4.5% in a week, the global online currency trading portal FXstreet reported in its latest edition of Iran Weekly Market Report.
In terms of technical analyses, the TSE all-share index has already entered its strongest support area, below 61,500. The next support levels remain at 60,000 and 57,500, while the minimum index measure in 2015 has been 61,163.
However, the Money Flow Index demonstrates that the TSE all-share index has already gotten into the oversold area, considering the 40% drop in volume in December compared to the average volume for the year. For any uptrend scenario to materialize, the index would first need to rise above the 63,000 level.
Also, the index of the 30 largest companies by market capitalization, TSE 30 index, declined as it closed at 2,569 slipping by 1.8%. This marks the sixth consecutive week that the TSE 30 index has been experiencing negative returns.
This week, Esfahan Oil Refining Company, and Bandar Abbas Oil Refining Company and Behran Oil Company had the highest negative impacts on the index as they lost 9%, 7.5% and 6.6%, respectively. This is while Iran Telecommunications Company had the highest gain among the top 30s by adding 2.9%.
Moreover, the Average Daily Trade Volume of the market reached $35.4 million, 92% higher than the previous week. The ADTV was inflated by large volumes of trades by participation bonds, sukuks and also block trades. Otherwise, the ADTV would have been almost 10% lower than the figure recorded last week.
The shares with the highest trade values were Bank Mellat, Iran Counter and Iran Polyacryl by recording 9.6, 8.4 and 3.3 million dollars worth of trades respectively. Bank Mellat’s share price closed at 1,937 rials (about 5.3 cents), 0.36% lower than last week. But Iran Counter surged by 23% closing at 16,578 rials (about 45.7 cents). The share price of Iran Polyacryl also gained 3.7%, as it closed at 2,455 rials (about 6.7 cents).
Iran Fara Bourse
IFB’s all-share index lost 9.3 points or 1.3% compared to the previous trading week to end at 676.
According to IFB, more than 794 million securities were traded in 80,000 transactions valued at over $1.9 billion. Trade volume and value filed a 161% and 99% growth compared with the previous trading week.
Furthermore, IFB’s market cap posted a 0.4% drop to settle at $22.8 billion. The First Market recorded the trading of 212 million shares valued at $16.6 million to register a 475% and 517% surge in volume and value respectively compared to the previous trading week. The Second Market filed the transaction of 241 million shares valued at $17.9 million to witness a 68% and 66% rise in weekly trade volume and value respectively.
Base metals with a 21% share of market transactions topped the charts among weekly gainers. Sugar companies and banks and credit institutions followed with 20% and 11% of the market share respectively.
Currency Market
The FX market witnessed almost zero changes in both official and market rates of the US dollar. The Central Bank of Iran set the official dollar-rial rate at 30,120, while the free market dollar rate reached 36,213 rials.
On the other hand, the official rate of euro recorded a 0.8% increase, reaching 32,917 rials. Similarly, its free market rate gained 0.1% to reach 40,073 rials.
The official rate of the British pound has been quoted at 44,811 rials, which is 0.5% lower than last week, while the free market pound-rial rate had no change, standing at 54,600 rials.
President Rouhani on Economy
Iranian President Hassan Rouhani announced the country’s expected economic growth for the next Iranian year (March 2016–17) to stand at 5%, while giving a speech in the city of Rey, south of Tehran. He also talked about the government’s proposed budget plan for the next Iranian year.
According to the president, 75% of the government’s sources of income are to be financed by non-oil income, while the share of oil income would be reduced to 25%.
Rouhani also mentioned a planned increase of 90% in the government’s construction budget and emphasized that more attention should be paid to water, environment and agriculture projects.
The development budget in the government’s spending bill is proposed at 570,000 billion rials (about $19 billion). Also, the government’s general expenditure budget is considered at 2,680,000 billion rials (about $90 billion).
The budget will be discussed in the Iranian Parliament where it will be reviewed and potentially amended before its implementation by the government.
President Rouhani also talked about the expected removal of sanctions on Iran in January and also quoted the Statistical Center of Iran regarding their latest report on the country’s inflation rate, which suggested a YoY rate of 9.9%.
The Central Bank of Iran has yet to publish its report on the country’s inflation rate, which is expected next week, where the reporting of a potential single digit inflation rate would mark a significant milestone in the country’s recent economic history.
