Uncertainty Drags Down Tehran Stocks

EghtesadOnline: Equities in both of Tehran Stock Exchange and the over-the-counter Iran Fara Bourse made a rare nosedive at the start of trading week on Saturday as markets dived following renewed military tensions in the strategic Persian Gulf region.

News ID: ۷۴۹۳۴۲

05 January 2020

TSE shed more than 16,700 points for the day, plunging 4.3% and taking a step backward to 367,000 points with sell-off hitting more than 90% of shares.

Investors pushed sentiment aside and rushed in swarms to dump shares unnerved and concerned about what could unfold in the uncertain future under rising political tensions in the strategic oil-rich region, according to Financial Tribune.

Stocks took a historic drubbing in terms of volume while in percentage terms the drubbing was at its highest since March 2015, according to analytical website Donyaye Bourse.

The massive sell-off in the early moments of Saturday’s trade forced members of the High Council of Securities and Exchange to hold an extraordinary meeting to prop up TEDPIX and avoid further damage.

Participants apparently mandated legal entities and investment funds to support the market by pumping money and buying stocks that traditionally have the most significant impact on TEDPIX.

More specifically, Capital Market Stability Fund and the Capital Market Development Fund were delegated the task of injecting billions of rials into the market, according to two stock market officials.

The officials told Bourse Press that the funds initially will concentrate on bank and auto stocks and later cover a wider range of stocks.

The moves slowed down the market collapse but were not apparently enough to boost the benchmark in the face of a large number of jittery investors.

While the majority natural entity investors were sellers,  legal entity traders bought equities worth more than 20 trillion rials ($153 million) from fainthearted sellers.

Market Performance

The TSE's main index TEDPIX lost 16,765.05 points, or 4.36%, on Saturday to end trading at 367,334.0.

About 6.93 billion shares valued at 31.34 trillion rials ($235.65 million) changed hands at TSE for the day.

Trading at TSE and over-the-counter Iran Fara Bourse starts on Saturday and ends Wednesday.

Among the handful number of stocks that ended in the green was Bafgh Mining Company whose price went up 4.37% to 87,628 rials per share.

Pars Minoo Industrial Company incurred the biggest loss among all TSE-listed companies and went down 9.53% to 14,494 rials per share.

Mobarakeh Steel Company contributed the most to the benchmark's fall, followed by Persian Gulf Petrochemical Industries Company, National Iranian Copper Industries Company and Golgohar Mining and Industrial Company.

Bafgh Mining Company gave the biggest boost to the benchmark index, followed by Dashtestan Cement Company, Iran Alloy Steel Company and Noosh Mazandaran Company.

The Price Index lost 4,485.02 points, or 4.36% to close at 98,284.0.

First Market Index was down 12,763.36 points, or 4.64% to post 262,422.6. Second Market Index was down 31,495.20 points, or 3.94% to reach 767,517.8.

The Industry Index went down 15,013.84 points or 4.34% to register 330,541.2. The Free Float Index was down 20,384.39 points to hit 433,328.05.

TSE 30 went down 762.25 points to settle at 15,299.6 and the TSE 50 ended 667.19 points lower to finish at 13,945.3.

IFX Plummets 4.46%

Iran Fara Bourse main index IFX lost 223.69 points, or 4.46%, to close Saturday trade at 4,797.17.

About 1.21 billion securities valued at 9.17 trillion rials ($68.96 million) were traded at the over-the-counter exchange for the day.

Save for one company, the remaining listed companies with IFB ended in the red. The companies that had the most negative impact on the IFX were Marun Petrochemical Complex, Goharzamin Iron Ore Company, Zagros Petrochemical Company and Middle East Mines and Mineral Industries Development Holding Company.

Alvand Housing Investment Company was the only company that had a positive side though the effect was insignificant.