Market News

– The cabinet members released the initial draft of bylaw governing the partnership between Iranian banks and credit institutes and foreign counterparts, either individuals or institutions. According to the new bylaw, the caps for foreign participation on Iranian Banks and credit institutes are as follows:

• Foreign Individual person:
  • Up to 10%; with CBI approval;
  • More than 10% up to a max of 20%; only with money and credit council approval
• Foreign Legal person (Financial)
  • Up to 10%; with CBI approval;
  • More than 10% up to a max of 25%; only with money and credit council approval
• Foreign Bank:
  • Up to 20%; with CBI approval;
  • More than 20% up to a max of 40%; only with money and credit council approval
• Foreign Legal person (non-financial)
  • Up to 15%; with CBI approval;
  • More than 15% up to a max of 30%; only with money and credit council approval

The CBI, only after the ratification of the draft by the cabinet members, shall provide the executive measures for practical steps to money and credit council for their approval.

– Making a framework for all governmental debt securities, 7 new tickets of administrations debt issues for the fiscal years 2015/16 and 2016/17 has been admitted on Iran Fara Bourse debt board, ready to trade on 13 & 14 Feb 2018. The below table shows the details on Sukuk Musharaka securities and their maturities.

Tehran Stock Exchange Hits New Lows Following the Risk-Free Rate Chaos!

In the Market

Stocks declined on today’ session with more power than before. The main catalyst behind the worst than expected movement is the sloppy situation of the ridiculously high risk-free rates. The TEDPIX slipped -0.59% to finish at a new low (96,028.48). Meanwhile, the IFEX also lost -0.34% and gave away a bunch of the other day’s gains.

Commodity-backed industries, exclusively Metal sector (-0.90), sold off in reaction to the US decision putting tariffs on EU steel imports. Analysts believed that the new US gesture would affect Iranian market as well. There was in the news that The tariff saga continued this week as some congressional Republicans and officials within the White House urged President Trump to reconsider the duties on steel and aluminium imports that he proposed last week, fearing that they could cause a trade war. Almost all of the sector giants, including Isfahan Mubaraka Steel (FOLD1, -1.05%, IRR, 2,820), National Copper Industries (MSMI1, -0.98%, IRR 2,624) and even Arfa Steel (ARFZ1, -4.98%, IRR 3,660).

Within the Chemical space (-0.58%), except one or two micro-sized tickers, the rest spent the day in the deep red. The ambiguities ahead of global oil price along with geopolitical tensions made the days unhappy for the heavy sized industry. Not to say, ending days of the current Persian year added to the sale pressure even more.

In general, the lack of money supply (e.g fresh liquidity) is sensible in the capital market atmosphere. The CBI’s rescue package didn’t help the market at all, pushing just the risk free rates to +20% area again after restless efforts spent to lower the rates on the banking sector.

Source:

2018, Foreigners are now free to buy-in Iranian Banks ownership!, Sunday, March 11, p.1,<https://agahgroup.com>