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Iran's stock market surges past key level to record high, as analysts warn of bubble

Published 08/02/2020, 04:02 AM
Updated 08/02/2020, 04:05 AM
© Reuters. A woman looks at electronic board showing stock prices, following the outbreak of the coronavirus disease (COVID-19), at Tehran Stock Exchange in Tehran

DUBAI (Reuters) - Iran's main stock index broke through the key 2 million point mark for the first time ever on Sunday, state media reported, amid warnings that the market is overheating.

The Tehran Stock Exchange's benchmark TEDPIX index gained 46,844 points in early trading, the official IRNA news agency said, up 2.4%.

The index closed at 1,961,649 on Saturday after surging by over 57,325 points, or 3.01%, on the day, according to the Tehran Stock Exchange (TSE) website.

Iran's clerical rulers have been encouraging ordinary Iranians to invest in local stocks to boost the country's economy, which has been hard hit by the reimposition of U.S. sanctions over Tehran's nuclear programme.

Analysts and some lawmakers, however, have warned that the move might raise the risk of a stock market bubble as the rising market is at odds with Iran's deteriorating economic fundamentals, which are also feeling the impact of the coronavirus outbreak.

© Reuters. A woman looks at electronic board showing stock prices, following the outbreak of the coronavirus disease (COVID-19), at Tehran Stock Exchange in Tehran

Iranian authorities have denied that there is a bubble in the country's stock market.

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