Seesaw Trading at TEDPIX, IFX

Tehran Stock Exchange’s main index shed 372 points or 0.5% during the week that ended March 1 to close at 77,475.

This is while IFX, the over-the-counter Iran Fara Bourse’s benchmark, added 3.2 points or 0.4% during the week to 870.2.

Trading at the two exchanges begins on Saturday and ends on Wednesday.

Over 4 billion shares valued at $250 million were traded on TSE during the past week. The number of traded shares and weekly trade value shrank by 30% and 18% respectively compared to the previous week.

TSE’s First Market Index shed 80 points or 0.1% to end at 55,029.

The Second Market Index lost 1,818 points or 1.09% to close at 164,483.

At IFB, more than 1.6 billion securities valued at $317.1 million were traded in 121,000 transactions. The number of traded shares and weekly trade value grew by 79% and 83% respectively compared to the previous week.

IFB’s market cap gained $190.5 million or 0.7% to reach $26.6 billion.

Its First Market witnessed the trading of 132 million securities valued at $6.3 million, indicating a 41% and 34% drop in both the number of traded securities and trade value respectively.

About 732 million securities valued at $87.4 million were traded in the Second Market, with the number of traded securities rising 232% and trade value rising 145% week-on-week.

The ‘chemical products’ group of IFB-listed industries had the highest weekly rise in share value (21.2%). ‘Information and communications’ (17%) and ‘base metals’ (12%) came next.

 TSE World’s 7th Best-Performing Exchange

A major highlight of the week was the World Federation of Exchanges’ ranking of Tehran Stock Exchange as the seventh best performing exchange in the world.

According to WFE’s latest report on its members’ performance, TSE’s main index, TEDPIX, closed 79,487 at the end of December 2016, which is almost 29% higher than a year earlier.

This performance also placed TSE as the third best-performing exchange in Europe-Africa-Middle East region after the Egyptian Exchange and Bourse de Casablanca.

Total market capitalization of TSE closed at $101 billion in 2016, 16% more than the value at the end of 2015.

  IME Listed on IFB

Iran Mercantile Exchange was listed on the over-the-counter exchange Iran Fara Bourse on Sunday.

Head of IFB Amir Hamouni and IME chief, Hamed Soltani-Nejad, attended the inaugural ceremony at the IFB headquarters in Tehran.

According to Hamouni, IME is the first exchange market listed on IFB.

The mercantile exchange went up for price discovery on IFB’s primary, or A board, which only enlists the most transparent and liquid financial institutions. It is followed by B and C boards ranked lower in terms of transparency and liquidity.

IME requested to be listed on IFB back in November.

“Entering Fara Bourse helps IME to take another step toward increased transparency,” Soltani-Nejad was quoted as saying by SENA. He added that this will help both market managers and investors better evaluate IME’s performance.

Founded in 2006, IME trades in agricultural, industrial and petrochemical products in the spot and futures markets. The market added gold certificates of deposit to its arsenal this year, complementing its gold coin futures trading.

  Debt Issuance to Be Limited

SEO Chairman Shapour Mohammadi said on Tuesday the Securities and Exchange Organization intends to limit the issuance of new bonds on the capital market, as its priority lies with supporting the equity market and the private sector.

His statement came after Chairman of Iran Planning and Budget Organization Mohammad Baqer Nobakht announced that the government plans to issue 85 trillion rials ($2.23 billion) of Islamic Treasury Bonds in the near future to fund incomplete projects across the country.

“These bonds will not be offered on the capital market,” Mohammadi was quoted as saying by SENA.

“I have said this before: Our priority lies with the equity market and financing the private sector. The government has all the right to issue bonds to raise capital, but we will not prioritize the government.”

According to Gholamreza Shafei, deputy for technical affairs and infrastructure development at Planning and Budget Organization, the government needs 4 quadrillion rials ($105 billion) to complete 70,000 unfinished projects across the country.

“It would take at least 10 years to complete all these projects,” Shafei said.

Almost half of the next year’s development budget ($7.5 billion) will be used to complete 2,700 incomplete projects.

The government has issued 420 trillion rials ($11.05 billion) of bonds so far in the current fiscal year, which ends March 20, to make up for its budget deficit.

The government pays up to 25% on its one-year Islamic Treasury Bonds, while inflation stands at about 8.7%. In the absence of risks, it is only natural that investors would shy away from stocks.

  Foreign Investors Pass 800 Mark

Also last week, Securities and Exchange News Agency reported that the Central Securities Depository of Iran issued 12 new trading codes to foreign investors during the Iranian month of Bahman (ended February 18), bringing the total number of foreign investors in Iran’s capital market to over 800.

The sole registration entity and overseer of Iranian securities issued the codes for seven institutional investors from Poland, the Netherlands, South Korea, Armenia, Malaysia and the UAE.

It also issued five codes for foreign individual investors from the United Kingdom, Germany and Afghanistan.

Apart from the above-mentioned countries, investors from the United States, Spain, Russia, Switzerland, Sweden, Uzbekistan, Azerbaijan, China, Lebanon, South Africa, Japan, Cyprus, Georgia, Turkey, Greece, Iraq, Italy, Norway, Indonesia, Maldives, Hong Kong, Pakistan, Syria, Kuwait, Luxembourg and New Zealand are currently trading in Iran’s equity market.