TEHRAN- Unprecedented fluctuations in the Iranian stock market over the past few months have led shareholders, experts, and scholars to call for the government to increase its support for the market.

Following the rising concerns over the market conditions, in early April, the Government Economic Coordination Headquarters, in its 216th meeting, approved some new directives for regulating the stock market.

Also, as the condition deteriorated and TEDPIX, the main index of Tehran Stock Exchange (TSE), which is Iran’s major stock market, experienced continuous drops, Stock and Exchange Organization (SEO) unveiled a comprehensive support package to encourage activities in the capital market as shareholders are getting reluctant to invest in the market.

As announced by the SEO Office of Public Relations, one of the major measures considered in this 10-section package is the insurance of shareholders’ capital and dividends over the next year.

The comprehensive support package of the capital market, which was designed last week and has been reviewed by the country's economic authorities, was put in effect on October 29.

Insuring the shares of real entities up to one billion rials (about $3,450) per person, issuing subordinated warrants on shares of fixed income funds up to 400 trillion rials (about $1.38 billion), injecting new resources into the market by sovereign funds to buy shares, depositing up to 50 trillion rials (about $172 million) of the resources approved in the national budget bill for the Capital Market Development and Stabilization Fund, as well as direct and continuous coordination, supervision and monitoring of the legal entities active in the capital market, including companies and semi-governmental financial institutions, pension funds and military institutions are among the measures considered in the mentioned support package.

As the result of the SEO’s support package, TEDPIX, which was experiencing drops day after day, has returned to a climbing status. 

This status brings the hope that the stock market will return to its previous prosperity condition soon, given that on Tuesday, SEO Head Majid Eshqi said that the SEO does not limit its support to the 10-section package.

“In order to increase the effectiveness of the support measures, we intend to submit a multi-section proposal to the economic headquarters of the government and we are trying to obtain resolutions in order to solve the major concerns of the stock market”, the official added.

Reiterating that the SEO does not limit its support to the 10-section package, Eshqi said that in this package, it was tried to resolve minor issues such as the non-matching of TSE and IFB (Iran Fara Bourse: Iran’s over-the-counter (OTC) market) trading times, the entry of initial public offerings (IPOs) into the market, etc., which caused the sensitivity of the shareholders.

With the follow-ups, new resources from the National Development Fund entered the stock market, and for the first time, this fund has purchased shares with its trading code; the SEO head announced, adding that this is a good move for the government and the stock market.

Also, a member of the parliament’s Industries and Mines Committee said on Wednesday that this action (the SEO’s support package) is effective in boosting investment and supporting infrastructure projects.

Farhad Tahmasbi said that a good mechanism has been seen in this field, which can attract the trust of investors and clients of the capital market by insuring the shareholders.

This action is effective in boosting investment and supporting infrastructure projects, he said, and reiterated, “With a coherent program to support the capital market, we can boost production and industry in the country by collecting people's micro capital”.