Tehran Stock Exchange (TSE)’s losing Streak continued on Saturday to drag down the TEDPIX to 16-month record low; however Persian Gulf Petrochemical Industry Company (PGPIC)’s creation units towards the end of trading hours helped the overall index to settle in green.
The block offering of the PGPIC pulled up the overall index to end the week’s first trading day flat.
According to the TSE data, the overall index edged up 0.2 point to recoup earlier losses, and stand at 65,029.1. The first market index lost 31.6 points or 0.07 percent to end at 47,821.9. The second market index gained 207.7 points or 0.16 percent to reach 128,430.7. The free float index slipped 60.5 points or 0.08 percent to finish at 73,465.4. The Industry index was down 43.8 points or 0.08 percent to 54,806.7, and the blue chip index was up 6.1 points or 0.21 to end Saturday’s shaky trading at 2,924.5.
Trade volume and value is still limping, with fears gripping investors day by day after the government failed to come up with a stimulus to change the persistent bearish trend at the equity market. More than 297 million shares changed hands, valued at 625 billion rials.
The unexpected block offering by the PGPIC made it the highest positive contributor to the TEDPIX. It has been predicted that the tumbling oil price will in turn affect the petrochemical complexes, causing a dramatic downtrend in the prices of their commodities, said Adel Nejad Salim, head of the PGPIC, adding that “oil price free fall will push feedstock prices down, hence, the bearish trend of petrochemical sector at the stock market is mostly due to the investors unsettled sentiments.
Mellat Bank and Tejarat Bank with 35 and 31 points positive contribution took the second and third place respectively, presumably due to the upbeat news of eased banking sanctions, which saw investors scramble to snap the bargain in a bid to gain in lackluster trading days.
The European Union’s second-highest court on Thursday struck down sanctions on the leading Iranian bank and a string of Iranian shipping companies, although judges gave the EU more than two months to respond before the decisions take effect, Wall Street Journal reported.
The report also noted that, the latest legal setback for the EU sanctions regime involves the lifting of an asset freeze and restrictions on Tejarat Bank, with the court saying the evidence presented by the EU to support its decision was insufficient. The shipping firms affected were subsidiaries of the Islamic Republic of Iran Shipping Lines, or IRISL.
Mobile Telecommunication Company of Iran led the market laggards. Ghadir Investment Company and Telecommunication Company of Iran also weighed on the TEDPIX with more than 25 and 15 points negative contribution.
Despite the creation units offered at the TSE making for a temporary remedy, ambiguities are still lingering at the equity market, with no practical solution for convincing the investors to flock back to the stock market.
FDI in Equity Market on the Rise
The number of foreign investors at the equity market is increasing, the Central Securities Depository of Iran (CSDI) announced on Saturday.
“After submitting the required documents and obtaining their trading codes, 27 foreign investors have been added to the list of traders at the equity market in the past two months,” Hamed Soltani-Nejad, head of the CSDI told SENA.
Soltani-Nejad explained that 8 investors from china, 16 investors from Afghanistan, plus investors from Germany, the UK, and Syria have recently joined the equity market.
The first foreign investor trading code was issued for a German company 20 years ago, and up until now, 313 investors have joined the equity market, said Soltani-Nejad.
“The number of foreign investors registering for trade at the TSE and Iran Fara Bourse (over-the-counter or OTC) increased dramatically in the current Iranian year, with Iran’s equity market grabbing the attention of 97 foreign investors since the year’s beginning on March 21,” Soltani-Nejad added.
