Stocks Ride High in H1
EghtesadOnline: Stock yields were higher than other markets in the first half of the Iranian fiscal year (March-Sep. 2020). TEDPIX, Tehran Stock Exchange's main index shot up 211% during the period.
Half Bahar Azadi gold coin was next posting 120% growth in H1. Price of the Emami gold coin showed 119% increase during the said period to rank third in terms of profitability, TGJU.org data indicates.
Despite historic highs, the US dollar and euro yielded 88% during the first six months. The Turkish lira gained 40%, mostly influenced by exchange rates in global markets, becoming the least profitable currency in the said period.
Gold coins topped the list of investments with the highest returns in the second quarter (June-Sep. 2020). This is while the stock market, the most profitable in Q1, yielded the lowest return compared to parallel markets.
A quarter Bahar Azadi gold coin gained 80% during the three months benefiting investors more than any other market. The quarter Bahar Azadi coin was traded at 40 million rials on the last day of summer.
Half Bahar Azadi coins also registered 74% increase and were priced nearly 70 million rials on Sep. 21. Emami gold coin ranked third, with 66% increase in the three summer months. The coin was quoted at 131 million rials by the end of Q2.
The economic news website, Eghtesadnews, reviewed key factors pushing up gold coin prices in Q2. Experts and analysts say the jump in forex rates, especially the dollar, was a highly influential factor triggering gold coin prices.
Following a Pattern
In what has emerged as a pattern going back years, the greenback and other foreign currencies again recorded new highs in summertime. In the open market the dollar gained 42.9%, from 185,910 on June 21 to a record high of 275,000 rials on Sep. 21.
The euro also increased by 55% to reach 318,520 rials on Sep. 21, topping the list of foreign currency with the highest returns. Next was the UK pound with a 48% return. The remaining currencies on average increased by 40% save for Turkish lira. It gained 28% during the three months.
Appreciation of the yellow metal in international markets due to the coronavirus -- nearly 13% in the past three months -- is also seen as a key factor, though the impact is usually not considered significant. Domestic gold prices are almost always a function of the currency market in Tehran.
Market observers say increase in gold coin prices was triggered by the recently imposed restrictions on the sale of foreign currencies. As such, investors looking for safe havens due to the continuous hammering of the rial rushed to buy gold.
Big blows to the Tehran share market also is a considerable factor pushing investors further towards the bullion market.
The Tehran Stock Exchange primary index, TEDPIX, gained 8,346.3 points or 25% in the second quarter of the current fiscal year to end at 85,831.8.
TEDPIX was the leading market in terms of profitability in the first quarter, however, its pattern of decline in recent weeks put it at the bottom of the list in Q2.
TEDPIX lost 3.45% to close trade at 1,595,160 points. That put the TSE benchmark loss at 9.2% in the last calendar month ending Sep. 21.
Gold coins and foreign currencies mostly finished Tuesday trade in positive territory.
Emami gold climbed to new highs and was priced at 132.2 million rials, a 1.24% rise compared to Monday's close.
Bahar Azadi gold coin was up slightly (0.5%) to reach 125.7 million rials. Half Bahar Azadi, however, lost 200,000 or 0.3% and was sold for 69.1 million rials.
One dollar fetched 271,100 rials in Tehran's free market, whereas bank-affiliated exchange shops priced the currency at 272,200 rials. The greenback registered 0.72% increase, compared to the day before.
The euro lost 0.51% on Tuesday to be quoted at 318,570 rials. Melli Exchange, affiliated to Bank Melli Iran, sold the currency at 319,500 rials. One UAE dirham was tagged at 74,600 rials.