Economy, Business And Markets

Stocks Continue Slow, Steady Uptrend

Stocks Continue Slow, Steady Uptrend
Stocks Continue Slow, Steady Uptrend

Tehran’s stock market continued its steady but sluggish upward trend on the week’s last trading day on Wednesday as the main index (TEDPIX) added 35.3 or 0.05 percent to finish up at 71,443.6.

According to the TSE’s website, stocks started a rally in the middle of the day, while the TEDPIX revised down at the end of trading day but stayed in the green territory.

In a sluggish trading day, most of the indices contributed to keep TSE’s sentiment up, while the free floating index and the chips were the major market impediments and finished in red.

The first market index was up 18.5 points or 0.04 percent to 52,433.2. The second market index rose 114.7 points or 0.08 percent to finish at 141,783.7. The industry index inched up 56.1 points or 0.09 percent to 60,584. The free floating index slipped 62.5 points or 0.08 percent to finish the week with a negative trend. In addition, the blue chip index shed 0.5 point or 0.02 percent to 3,285.7.

Within 32,702 transaction rounds, close to 459 million shares changed hands valued at 1.328 trillion rials.

Among the 39 industries in the TSE, the radio industry ranked highest as the Telecommunication Company of Iran claimed the market’s top spot. The state telecom pushed the TEDPIX up by a 41.53 percent.

The Mobile Telecommunication Company of Iran, the Civil Pension Fund Investment Company, Sepahan Oil Company and Pars Oil Company were the other entities at the TSE that left the most positive impact on the market’s benchmark.

Omid Investment Group Corporation and Pasargad Bank were the market laggards as they left the most negative impact on Tehran Stock Exchange’s main index.

The equity market has been experiencing a downward trend in the past 6 weeks, but the falling status stopped three days ago. Some market analysts believe that the TSE’s listed firms’ six-month report and a possibly positive outcome of the nuclear negotiations between Iran and the P5+1 will drastically change the poor performance of the equity market.

“Since the market investors are keeping an eye on the six-month report to see the consequences of the government’s policies on the industrial output and the capital market, these reports weigh a lot on the equity market,” Ebrahim Enayat, managing director of the Bank Parsian Brokerage Firm old ISNA.

With regards to the result of international negotiations over Iran’s nuclear program, the future is not gloomy anymore, although shaky investors are not still confident about a tangible comprehensive agreement.

It should be noted that there are other practical factors, which may not be ignored as they play an essential role in bolstering the capital market.

Observing international standards in companys’ financial report is among the most highlighted factors, that could help attract foreign portfolio investors.

XBRL, or eXensible Business Reporting Language -- an international standard for firms’ financial reports, is among the most crucial contributors to the market’s transparency.

Foreign investors would not accept the countries’ financial standards as the reports are not compiled based on internationally accepted terms. Hence, XBRL is to unite the financial reports’ frame, which is a solid indicator for foreign investors to evaluate companies’ strength for investment.

The TSE initiated to urge Iranian companies to follow this standard and after a few months, as planned, companies must comply with this standard.

Investors are waiting to see a breakthrough in the national economy as any substantial positive move may shift the market trend, bringing traders back to the stock market.

Analysts believe that TSE officials and the government should be serious in implementing the internationally recognized plans to revive the market and pave the way for attracting cash flows from overseas.