Stocks gained ground at the Tehran Stock Exchange with the benchmark piling up gains, after giant listed petrochemical companies outperformed at Saturday’s close.
As was expected, clarification on feedstocks’ price by the Guardian Council made investors lineup to garner the petrochemical companies’ shares, which helped the TEDPIX to settle in green territory.
According to TSE data, the overall index was up 334.2 points or 0.51 percent to stand at 66,273.3. The first market index rose 142.4 points or 0.29 percent to end at 49,016.7. The second market index soared 1,339 points or 1.05 percent to 129,053.
The free float index gained 318.5 points or 0.42 percent to 75,628.7. The industry index ticked up 286.3 points or 0.52 percent to finish at 55,651.9, and the blue chip index was up 11.6 points or 0.39 percent to 2,981.5.
Forty-eight percent of the listed companies managed to gain, and 47 percent retreated and settled in red.
Stocks have hit rock bottom values with the benchmark nose-diving to new record lows within the past couple of weeks, with individual and institutional investors losing thousands of dollars. Hence, a few days of uptick won’t entice them to get rid of shares; rather they are eying extended winning streaks in the future to compensate their losses.
The cautious behavior of shaky investors, weighed on the volume and value of trade. The weeks’ first working day witnessed more than 349 million share changing hands, valued at 796 billion rials.
The Persian Gulf Petrochemical Industry Company topped the positive TEDPIX contributors with almost 135 points. Ghadir Investment Company with over 59 points positive contribution took the second place, and Parsian Oil and Gas Development Company took the third place.
Tumbling oil prices have dramatically endangered the government’s previously expected revenues, portraying a gloomy atmosphere ahead of the economy. So, the administration has no other way but to somehow offset the lost revenues with new ones.
It is evident that the administration is determined to uncover the petrochemical sector’s true potential, as one of the leading sectors of the country, which could in turn help TSE’s dented sentiment, and fund the government.
Despite the shift on the sector, petrochemical complexes are still grappling with western sanctions on Iranian banks. Moreover, the lingering talks between Iran and the P5+1 with no concrete result, the prevailing recession in the economy, and the current oil slump are expected to further squeeze the sector.
Petrochemical commodities’ prices are on downward trend; however, local currency depreciation may help them to compensate the lost revenues.
The economy has been buoyed by sharp cut in expenditures, which is likely to be accompanied by higher rate of inflation. As the economic indicators are still trimming positive prospect for the economy in the upcoming months, no practical upward trend could be expected at the equity market.
