Market News

– Aiming at improving their financial status by getting rid of their excess assets and cutting their costs, the Central Bank of Iran’s latest report proves a 0.3% decline in Iranian banks’ branches (to stand at 20,723) at the end of previous year (March 21^st) in comparison with the prior year.

– Announcing the maximum return rate of 5% and 4% on bank deposits denominated in US dollar and Euro, the governor of the CBI advised depositors to keep in mind banks’ credibility and trustworthiness (based on their behavior) along with the return ratio as the major measures when selecting their investment destination.

– Over a meeting with the private sector representatives, President Rouhani assured them that the new foreign exchange policy of setting the USD/IRR at IRR 42,000 seeks the reinforcement of market stability and improvement of economic growth and help businessmen, both producers and exporters in achieving their goal. He then, demanded banks to absorb foreign currency deposits in order to boost exports.

– As the deputy minister of industries, mines and trades has said, Iran is now at the final stage of absorbing investment worth EUR 2 bn from Europe (Italy and Austria) in steel and copper projects and negotiations are also in play to enter into a contract with Swiss investors to develop the major Zinc deposit of Mahdiabad.

In the Market

Influenced by the ambiguities due to foreign exchange rate unification 2 weeks ago, the TEPIX registered a -0.8% decline over the past week. The vague resulted environment has deprived investors of analyzing companies’ profit in the long term, which intensified by concerns over the JCPOA fate late in the current month, dragged the prices and volume of trades down.

Influenced by the decline in copper and zinc prices, the related names in the Metals and Iron Ore groups went under sales pressure. Statistics show that 6.8 mn tons of crude steel have been produced in the country over the first quarter of 2018, which registers a 47% rise compared to the same period last year.

The Automotive industry also witnessed negative trades such that only Motorsazan-e Iran Tractor (+4.3%) kept its head above the flat line.

With global methanol price approaching $400, Zagros Petrochemical in the Chemicals group saw positive trades. Fars Chemical Industries managed to experienced 4.5% growth while nearly the rest ended in the green.

In the Banking space, Bank Tejarat led the sector in terms of the trading volume by 1.7mn shares while lower volume of Bank Saderat shares changed hands. Bank Hekmat-e Iranian ticker was halted after announcing a -73% EPS adjustment; the company failed to sell its excess assets and its costs rose as the CBI obliged them to offer 20% return certificates of deposits; the ticker returned to the market 3% lower at IRR 900.

Unlike the previous sessions, low volume and negative trades we conducted in the Oil Products space; the majority of purchases are done by institutional clients.

Source:

2018, Iranian banks to reduce branches!, Saturday, April 28, p.1,<https://agahgroup.com>