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EghtesadOnline: Stocks in Tehran took a reverse at the opening of trading week on Saturday with interest in large-cap stocks shifting to smaller companies with market indicators showing mixed results.

Heavily impacted by giants of the market, the benchmark of Tehran Stock Exchange, TEDPIX, dropped 1.77% shedding 32,553 points for the day. It later retreated to 1,809,147 points. 

The TSE-30 index, which tack shares of 30 companies with the highest market caps, took a drubbing and dropped 3.56%.  

On the flip side shares of smaller companies heaved a sigh of relief after a deep correction stage. The equal-weighted index parted ways with TEDPIX amid a renewed demand for micro-cap shares.   

The index was up 1.38% and added 6, 6629 points. Equal weighted index offer a better picture of the market as it gives the same weight to all shares irrespective of their market capitalization. 

For weeks investors have set their sights on a handful of shares of big companies in many of which the government has stakes. Apparently the rest of the market was pushed on the margin. 

Upbeat sentiment for large-cap shares emerged from the government’s repeatedly declared support for the share market, giving rise to the perception among investors that if there is so much of strong backing from the government it is highly likely that giant companies will continue to dominate. 

Investors largely lined up to buy shares of companies that are on the government divestment list, guided by the temperament that the government wants prices of such shares to go higher in order to be able to raise funds when it later sells these shares  via exchange-traded funds. 

The divestiture scheme involves ceding government shares in a number of banks, insurance, auto, refineries and metal companies via ETFs.  

Investors’ zeal toward the large-caps sparked has criticism from many quarters, particularly from those investing in small-cap shares, over the unbalanced state of the market. 

TEDPIX went into a correction phase on Saturday amid this negative climate, although market analysts say the correction would be short-lived given the soaring foreign exchange rates and a slew of investors looking to shares as save haven assets.        

The highest trading value was registered for auto, basic metals, and bank stocks. The market also witnessed 8.8 trillion rials cash ($38 million) flowing mainly into small shares.

Total net retail trading value stood at 169.21 trillion rials ($740 million), which was 37% lower than the previous session, according to data released by the Tehran Securities Exchange Technology Management Company. 

About 7.4 billion shares valued at 127.96 trillion rials ($530.18 million) changed hands at TSE for the day.

The junior equity market, Iran Fara Bourse, also opened on a high note with its main index, IFX, gaining 1.62% on Saturday.  

About 2.6 billion shares valued at 53.56 trillion rials ($220 million) were traded at the over-the-counter exchange. 

Tehran Stocks market indicators