Saturday marked the end of the first of quarter of current Iranian fiscal year when the stock market experienced a big boom by recording 143% gain.
Spike in foreign currency prices and the ensuing real and expected inflation growth boosted price prospects for most listed companies, which consequently should increase their share prices in the near future.
Besides creating inflationary expectations, soaring forex rates help export-oriented companies earn more when their currency is converted into rials.
The US dollar soared again on Saturday to above 190,000 rials, being the highest quoted price ever.
Before opening the market on Saturday, there were concerns among investors over a probable negative impact of a resolution critical of Ian by International Atomic Energy Agency, according to Donyaye Bourse website.
The IAEA’s 35-nation board passed a resolution on Friday, calling on Iran “to fully cooperate with the agency and satisfy the agency’s requests”.
While the decision added to the turmoil in currency and gold markets, it visibly failed to perturb stock market investors.
The share market rally was led by large cap stocks in refinery, base metal, mineral and petrochemical companies, many of which are export-oriented and their prices highly sensitive to fluctuations in the currency market.
Better performance of most of large-cap stocks put the TSE-30 Index slightly higher at 3.7%. TSE-30 Index tracks performance of 30 largest companies in terms of the market cap.
This is while the equal-weighted index, which gives the same weight to all shares irrespective of their market capitalization, closed lower at 2.63%.
Market Performance
About 8.61 billion shares valued at 115.8 trillion rials ($616 million) changed hands at TSE for the day. Trading at TSE and over-the-counter Iran Fara Bourse starts on Saturday and ends Wednesday.
Khouzestan Cement Company was the biggest winner as its shares went up 21.35% to 27,450 rials per share.
Aabsal Company (home appliance manufacturer) incurred the biggest loss among all TSE-listed companies and went down 5% to 54,910 rials per share.
Mellat Bank contributed the most to the benchmark's fall, followed by Iran Mercantile Exchange, Pars Petrochemical Company and Tehran Cement Company.
Mobarakeh Steel Company gave the biggest boost to the benchmark index, followed by National Iranian Copper Industries Company, Persian Gulf Petrochemical Industries Company and Social Security Investment Company.
The First Market Index increased by 31,344.93 points, or 3.39% to post 956,984.49. The Second Market Index went up 76,936.14 points, or 3.23% to reach 2,445,399.06.
The Industry Index was up 37,653.02 points or 3.51% to register 1,109,503.19. The Free Float Index was up 51,889.35 points to hit 1,712,507.91.
TSE 30 went up 2,117.65 points to settle at 59,103.43 and the TSE 50 ended 1,667.1 points higher to finish at 47,841.94.
IFX Up 2.7%
Iran Fara Bourse main index, IFX, gained 373.34 points, or 2.7% to close Saturday trade at 14,179.62.
About 3.31 billion securities valued at 56.85 trillion rials ($302.42 million) were traded at the over-the-counter exchange for the day.
Jahrom Power Plant Development Company had the highest number of traded shares as 287.13 million worth 1.97 trillion rials ($10.52 million) were traded.
Tukarail Company, Ghasem Iran Company and Toliddaru Pharmaceutical Company had the most negative impact on IFX.
Middle East Mines and Mineral Industries Development Holding Company gave the biggest boost to IFX, followed by Esfahan Steel Company, Saba Tamin Investment Company and Hormozgan Steel Company.