After the annual weeklong holiday, the stock market reopened on March 26 on a promising note that continued throughout the week.
During five trading sessions, the benchmark of Tehran Stock Exchange, TEDPIX, gained close to 67,000 points climbing 4.75% to settle at 1,432,106, the highest in four months.
Small caps eked out slightly bigger gains pushing up the TSE’s equal-weighted index by more than 5% during the week.
Retail trade rose in the previous trading week indicating the increasing inclination of retail investors.
The average value of daily trade rose from 31.8 trillion rials ($120 million) per day to 45.12 trillion rials ($170m) – up 42% compared to the average daily trade in the earlier week.
In tandem with the role of retail investors, the market experienced inflow of fresh liquidity after months of capital outflow. Total capital inflow by retail investors amounted to 3.82 trillion rials ($14.4m) during the week.
Observers link signs of recovery in the share market in part to the support measures taken by the government to bolster the struggling share market.
In one such measure, the Central Bank of Iran in the last days of the last fiscal year announced new forex rates based on which lenders should convert their currency assets.
The new rates increased substantially compared with the past. The euro was near 220,000 rials (or equivalent in other currencies) and the dollar close to 200,000 rials, respectively, indicating 70% and 81% increase compared with previous parity rates.
The latest conversion rates will guide 18 lenders listed in the bourse market to draft or revise their annual financial statements ending on March 20.
Increasing exchange rates was one of ten measures approved by the government in December to support the stock market.