TEDPIX Wins 1% in Trading Week

Stocks closed the rather uneventful first week of the month with strong growth, mostly owing to the upsurge at both Tehran Stock Exchange and Iran Fara Bourse on Saturday.

Tehran Stock Exchange’s main index TEDPIX gained 869 points or 1% during the first week of the month that ended on Oct. 25 to close at 86,636.8.

TEDPIX lacks less than 3,000 points or 3.4% to break past its historical resistance level of 89,500 recorded on Jan. 5, 2014. The benchmark index is currently standing at its 45-month high.

The main index of the smaller over-the-counter exchange Iran Fara Bourse, IFX, also added 18 points or 1.9% during the week to end at 946.8.

IFX also has some heavy lifting to do to reach its all-time high of 961.03 posted on September 27.

Trading at Iran’s stock market starts on Saturday and ends on Wednesday.

Over 4.73 billion shares valued at $272.4 million were traded on TSE last week. The number of traded shares and trade value grew by 51% and 15.4% respectively.

TSE’s First Market Index gained 723 points or 1.21% to end at 60,253.8. The Second Market Index rose by 1,304 points or 0.69% to close at 191,293.1.

At IFB, more than 1.72 billion securities valued at $170.7 million were traded. The number of traded shares grew by 28% while trade value dropped by 14%.

Its First Market witnessed the trading of 81 million securities valued at $3.75 million, up 6% in traded shares and down 2% in trade value. About 526 million securities valued at $37.57 million were traded in the Second Market, dropping 20% and 1.8% respectively.

Over 3 million debt securities valued at $78.8 million were also traded at IFB, shrinking 34% in both number of bonds traded and their value.

> Base Metals Lead the Charge

Base metals were again the leading industry for the week, as the index gained 4.3% in the five trading days with Mobarakeh Steel Company spearheading the growth.

Iran’s largest flat steelmaker was continuously in the green with the exception of a slight downtick on Monday. It gained a total of 10.3% during the week to reach 2,360 rials per share.

Growing global prices and stronger euro and USD have helped steelmakers post significant gains this year, prompting further capacity expansion and increased production.

According to World Steel Association, Iranian mills produced 16.23 million tons of steel this year up to the end of September, up 30% year-on-year. The country’s crude steel output was also up 40.4% YOY in September to reach 2.3 million tons.

Other than MSC, other base metal producers such as iron and zinc miners did not have much going for them, as investors’ enthusiasm over their stocks waned following the publication of their H1 performance.

Sugar producers and oil extraction also shared the second spot in weekly returns with a 3.6% growth.

The third place jointly goes to "information and communication industry", with its sole listed company being the privately-owned ISP HiWeb, and the petrochemical industry. Both have posted a 3% growth in returns this week.

Ever since its initial public offering this year, investors have shown sustained interest in HiWeb’s stocks both due to its performance and the company’s bright outlook.

Petrochemicals have also risen on the back of improving methanol and urea prices as well as a weakening currency against the dollar. The industry is expected to fare well, considering that most of them procure raw materials using the cheaper official exchange rate while selling their goods at market rates.

The tire and auto industries were the week’s worst performers with a 5.4% drop in indices, followed by agriculture with 4.8% and coal with 4.3% downturns.

> Slow, Steady Gains in Forex, Gold Markets

Major currencies were slowly but steadily gaining against the rial this week, as traders’ concerns over political risks seem to have cooled down for the time.

The USD opened Saturday trading at 40,140 rials, having stabilized after a recent rally that considerably pushed up the value of most highly-traded currencies and lasted most of October.

The greenback gained 0.44% this week to close at 40,320, according to Tehran Gold and Jewelry Union’s website.

USD has so far this fiscal year (March 21-Oct. 26) gained 7.57% against rial. It stood at 37,480 rials on March 21 and barely budged for the first four months. Its rising trajectory started in the fifth month, prompting a steady growth afterwards.

Euro, the other popular currency in Tehran’s market, staged stronger weekly gains against the rial. The European currency changed hands for 48,280 rials by the end of the week to register a 400-rial or 0.8% week-on-week jump.

Euro has been on a much sharper trajectory compared to USD, as it has risen globally in value. It started the year at 41,120 and was up 17.4% against the rial during the period under review.

Bahar Azadi, the benchmark gold coin, also gained 0.63% during the week to end at 12,740,000 rials. It recorded a total increase of 80,000 rials compared to its last week’s close of 12,660,000.

The gold coin started the year at 11,790,000 rials and has so far risen 8.05%. Most of the growth took place in the seventh month of the year, as traders looking for safe haven from political risks boosted prices by 620,000.