Tehran Stock Exchange (TSE) overall index hit a new peak on Sunday's close, after reports that Iran and the P5+1 may clinch a nuclear accord by Monday evening, a self-imposed deadline to reach a comprehensive agreement.
The TSE was on a downward trend within the past 8 days, though all market indices recorded positive trades, contributing to the benchmark's upsurge.
In recent days, investors have been mulling to invest in the stock market, while market jitters are pressing them.
But stocks have hit rock-bottom values, the Price Earnings ratio (PE) is at a historic low and semi-annual reports of the listed companies demonstrate they have outperformed. Hence a possible nuclear accord can unleash the equity market potential, as the positive expectations on Sunday drove skeptical investors to shore up their portfolios.
According to the TSE’s website, all indices settled in green, and pushed the benchmark to hit a new peak after a series of negative trading days.
The TSE’s gauge rose 347 points or 0.46 percent to stand at 75,389.6. The first market index gained 345.6 points or 0.62 percent to end at 55,791.9. The second market index in line with other indices pulled higher 94.5 points or 0.06 percent to 146,609.5. The free float index-which has significant impact on the TEDPIX, was up 701.4 points or 0.81 percent to 87,130.2. The industry index climbed 133.9 points or 0.21 percent to finish at 62,759.3, and the blue chip index increased 25.8 points or 0.75 percent to 3,463.9.
Trade volume diminished slightly, while the trade value briefly pulled higher. More than 1.12 trillion shares changed hands, valued at almost 2.69 trillion rials.
During Sunday’s trade, the stocks of high yielding companies grabbed the attention of investors again.
Saderat Bank topped the highest volume of trades and briefly contributed to the positive trend of the TEDPIX. Cement Investment and Development Company, the one has recently launched its Initial Public Offering (IPO), took the second place and Iran Khodro stood at the third place.
As was expected, financial groups had the most lucrative trades, with Mellat and Tejarat Bank topped the largest trade value.
As market analysts stress, various indicators can practically alter the equity market’s sentiment, among which are the outcome of the nuclear talks, the Rouhani administration’s economic plan, the future of the interest rates, and the performance reports on the listed companies.
Pioneer industries are already listed at the equity market eying the political and economic development in order to forecast their earnings.
Iran is a frontier market with a dynamic economy which is likely to grow, given the sanctions lifted.
With the ease of sanctions, the automobile industry, pharmaceuticals, and financial groups are likely to benefit the most.
Ali Salehabadi, the head of the Securities and Exchange Organization, has recently emphasized that foreign portfolio managers are preparing to pour money into the stock exchange. Moreover, Hassan Ghalibaf-Asl, the head of the TSE, also said the number of foreign investors has increased.
The government is also determined to further curb inflation and help the economy recover. Given the improving situation, analysts predict the economy, including the equity market, would soon come back on track.
