Market News

– Following the recent FX upward trend in Iran’s Economy, the USD/IRR started a rally on Sunday to surpass 46,400 level, going up by IRR 950, pushing the IRR towards record lows falling 1.4% just in a matter of few days. Euro and British Pound also took a hike against IRR to stand at 58,500 and 63,390 levels respectively. Analysts attribute such a sharp rise, with global markets closed, to USD fluctuations’ effect on other currencies. With the two out of the 3 major factors affecting the foreign exchange rate in Iran, i.e. crude oil price, GDP and money supply growth, increasing, it seems that the money supply is pressuring the forex market the most.

– Following the proposal of Iran budget and plan organization along with two ministries of oil and economic affairs, President Rouhani’s cabinet approved the issuance of new Sukuk Salam securities worth IRR 40,000 bn (cUSD 879 mn) on Iran Energy Exchange with proceeds dedicated to meet the needs of Iranian Subsidies reform plan.

– The Statistical Center of Iran announced the 8.2% increase in the Goods and Services Price Index for the 12 months ended January 20^th, compared with the same period last year. The urban and rural inflation stood at 8.1% and 9.2%, respectively, with the former showing a 0.2% increase while the later remained unchanged.

– According to an official in the Iran-Iraq Chamber of Commerce, Iran has exported commodities, mostly food, agriculture products, construction materials and steel, worth $5 bn since the beginning of the current Persian calendar year; Iran’s share of Iraq’s market hovered around 20% in 2016/17, which brought about the export of $6.1 bn worth of products to this country, then.

In the Market

The TEDPIX climbed by 408.30 points today, influenced mostly by the heavily weighted Chemicals space; the US/IRR recent rally has been the major driver in several sectors in today’s session.

Fueled by higher US dollar and urea prices, the Chemicals industry continued its upward movements, mostly by its petrochemical companies such as Khorasan, Kharg and Kermanshah Petrochemical companies hitting their highs.

A positive sentiment was also detected in the Iron Ore space; Iran Manganese was the only name facing a buy queue. A block trade, made of up 181 mn shares worth IRR 340 bn, was done on Mines & Metals Development in the retail market as well.

The Automotive space started the session in the red. Iran Khodro and Iran Khodro Investment Development, however, entered the green zone in the middle of the session; it seems that these two will continue fluctuating until its block trade is done on January 21^st. Zar Spring Mfg. and Electric Khodro Sharq touched their ceilings.

The Transportation space also settled with balanced trades, led by Rail Pardaz-e Seir; the company saw a rise in demand. Estimating to make IRR 76 EPS for its FY, it has realized 79%, equal to IRR 60 in the 9-month period, whereas it had realized 82% in the same period last year. While its operating income and profit have seen a 35% and 33% decline, its non-operating income has grown from IRR 3 bn to IRR 45 bn, which along with its tax exemption, has resulted in the 33% rise in its EPS; the company’s wagons will enter the country until the end of the year. Tidewater-e Khavar Miane was another symbol going up by 4%; IRI Shipping Lines and Persian Gulf International Transportation, although, shed more than 4%.

Source:

2018, USD/IRR Battel on Iran’s Economy!, Monday, January 22, p.1,<https://agahgroup.com>