Market News

– After the rapid jump of Iran Inflation Rate due to a massive devaluation of the national currency, the new CBI’s data show that the pace of prices rising up is now slowed down. The point to point inflation rate reached 34.9% during the last month, however, the monthly growth rate reduced from scaring figure of 7.1% to 2.6%. This means that the inflationary effects of a rapid plummet of the Iranian Rial are now deflating to more reasonable levels. 

– Indian National Oil Company is now considering to import a daily figure of 180K barrels of Iranian crude after the US exemption. Reports have that the company is to sign a contract for the fiscal year of 2018/19 on Iran oil purchases which will happen in Indian rupee currency and through UCO bank. Moreover, it seems that China, the biggest buyer of Iranian oil, is to resume its purchases after one month halt and will import 360K barrels per day.

– In light with the administration’s new policy to amend Iranian banks structure, the new chair of CBI gave the green light to banks translating their FX reserves with the NIMA rate currency. The proceeds from this exchange shall be used only to raise the banks capital and are not distributable. According to Hemmat, this is the first step in the long-awaited battle to amend the disruptive banking structure in Iran.

In the Market

Equities lost again on today’s session in what was a shortened, low-volume trading day on Iran Capital Market. Today’s volatile session extended the benchmark index’s weekly losses mostly indebted to the falling oil prices on global markets. TEDPIX (-254%) fall for almost 4,500 points to lose all its technical supports and stood at 171,252.93. IFEX (-2.27%) was exactly the same dragged down by its energy-related shares. The disappointing performance of oil along with global commodities falling made the day red for stocks.

The oil-sensitive Oil Products (-3.01%) and Chemicals (-3.35%) sectors greatly underperformed both markets as oil prices continued to fall. All major names of these industries ended the day with losses between 0.1 and 5%. The falling prices of Methanol and Urea to their new bottoms made the situation even harder on tickers once were the market unicorns.

On the flip side, with nearly settling for higher prices in sales, components of the Auto (+3.92%) sector were highly demanded by investors and most of them faced with massive but queues towards the closing bell. The situation was somehow the same for tickers of mid-weighted Banking (0.93%) sector, however, the demand power does not overcome the supply side and most of the components settled near their flat lines.

The general belief in the market is that the days of giants have now come to an end and until the year-end small to medium-sized tickers will rule the market. Unless something extraordinary happens with the global markets of energy, the situation is believed to stay the same for the next year coming. Moreover, the monthly performance reports of companies along with Q3 results are now closer than ever and it is expected that should the firms performed handsomely after the US sanctions snap back, it could pump the market with fresh demand.

Source:

2018, Iran Inflation Rate deflates the FX jumps excitements!, Saturday, Nov 24, p.1,<https://agahgroup.com>