Market News

– After months of pointless disputes around joining CFT convention, Iranian Parliment finally voted “Ay” on the bill and as its result, Iran will officially join FATF countries’ list. Although the voting was anonymous, yet the numbers of senators in favour (143) outweighed the against members (120) and there were 5 blanks votes. This would have massive effects on the future of Iran’s banking and financial transactions in the absence of united states after their withdrawal from JCPoA. 

– Vice chairman of Iran chamber of commerce announced that the quasi-SWIFT mechanism of EU is now passed the negotiation phase and reached pragmatic steps and it would be in effect before the deadline of US sanctions on November 4. According to Hossein Salah Varzi, this European version of SWIFT is dedicated to Iran banking and financial transactions and ratification of FATF related amendments (CFT convention) was a mandatory move that now has been taken.

– The director general of Iran Tax administration research centre has announced that “Capital Gain” taxes are to be imposed on different assets in Iranian tax environment soon. Pointing out that any tax-related decisions can have syndicate effects in the short-term while in long run their positive signs would help the general structure of any economy, Saeed Tootoonchi continued that this type of tax has been in play for more than a century in all international markets.

– Isfahan Mubaraka Steel, one of the largest steel producers of Iran, is to finance its activities via the issuance of standard parallel Salam securities worth IRR 2,000 bn (USD 47.62 mn – USD/IRR 42,000) on Iran Mercantile Exchange. These issues will have an embedded put option of 18.5% along with a call option of 19%. Tamadon Investment Bank would be book runner and underwriter of FOLD salam securities.

In the Market

The stock market fell again on today’s session and this time the hit was the hardest over the recent months. The out of the logic bearish trend of the Tehran Stock Exchange and Iran Fara Bourse surprised experienced participants. TEDPIX (-4.16%) lost more than 7,600 points in an emotion-driven session while IFEX (-4.21%) performed somehow the same. Despite the better than expected purchases of big institutional clients amid the mid-half session, the rookie mistakes of newly entered day traders made the situation unbearable throughout the end.

Agah estimates show that during the last 7 months, a figure of circa IRR 55,000 bn (USD 1.31 bn – USD/IRR 42,000) has been injected into the market from the retail side and so far only an amount of circa IRR 10,000 bn (USD 238.09 mn) is withdrawn by the same sector. The below image demonstrates as well that the trend of cash withdrawal is continued over the last two sessions, however, the pace has not accelerated yet.

Just today a figure of circa IRR 4,030 bn (USD 95.95 mn) has been taken out from the market which is the largest this year so far. Experts believe that all these are signs showing that the market shall retreat tomorrow and continue its winning streaks once again.

Failing that and according to the above technical analysis of the market, the overall index has the potential to reach its first resistance level of 171K.

Source:

2018, Iran finally joins CFT convention!, Sunday, Oct 07, p.1,<https://agahgroup.com>