Fragile atmosphere at the Tehran Stock Exchange (TSE) has dragged down the benchmark further to settle at a striking distance from its record low set in the past 12 months.
The steady reduction in oil prices, an uncertain future for the economy, and investors’ gloomy sentiment is pushing the TEDPIX down, raising alarms that bears may take control of the equity market once again.
Hopes are dashed at Tehran bourse with lots of investors losing both their money and faith towards the TSE’s fluctuations, with so many of them lining up to sell high-yielding companies’ shares.
These overreactions are mostly due to the investors’ behavior, as they often base their investment decisions on temporary sentiments, fads, and other psychological biases, and not on market fundamentals.
The TSE’s overall index posted fresh losses at Saturday’s close, while the blue chip index as well as the first market index ended the day as the only positively contributing indices to the TEDPIX.
According to TSE data, the benchmark dipped 148.2 points or 0.21 percent, to extend its broad losses, ending at 71,712. The first market index edged up 9.6 points or 0.02 percent to finish at 52,803.4. The second market index dropped 1,071.4 points or 0.75 percent to settle at 141,203.6. The free floating index shed 24.4 points or 0.38 percent to 82,141.4. The industry index pulled back 158.2 points or 0.26 percent to 60,165.1, and the blue chip index gained 12.4 points or 0.38 percent to stand at 3,235.6.
More than 605 million shares were traded, valued at nearly 1.4 trillion rials, posting a dramatic decline in trade value.
Pars Khodro recorded the highest volume of trade, while this carmaker left a negative impact on the TEDPIX. Saipa Investment Company had the second largest volume of Saturday’s trade.
The giant petrochemical complexes, Persian Gulf Petrochemical Industry Company and Tamin Petroleum & Petrochemical Investment Company, as two market laggards on Saturday, left the most negative impact on the TEDPIX.
Plummeting oil prices spurred concern among the shareholders of listed petrochemical firms, after prices of these companies’ products kept falling for another day. As the fluctuations at the foreign currencies market have all but stopped, petrochemicals may not enjoy big gains from exports.
The current developments have impacted the petrochemical companies and their shareholders, although a big group of shareholders prefer to get rid of these companies’ shares.
Tejarat Bank, and Chadormalu Mining and Industrial Company were other big losers at the equity market on Saturday, with 16.15 and 10.57 percent negative contribution to the TEDPIX, respectively.
Mobarake Steel Company topped the positive contributors to the benchmark, and Pasargad Bank and Iran Khodro stood next.
After a few days of selloffs, investors lined up once again for Iran Khodro’s shares after hearing the news of a joint venture between Peugeot and Iran Khodro, the largest Iranian carmaker.
In spite of the fact that the hobbling economy is not portraying a transparent and bright economic outlook, investors’ emotional decision-making still heavily weighs on the TSE’s gauge.
