Global inflation negatively affects stock market: expert

Stock market analyst Mostafa Safari believes that global economic stagnation and inflation have negatively affected stock markets all around the world including the Iranian capital market, IRNA reported.

According to Safari, the outlook, however, is positive for the next two years and the Iranian stock market is expected to get back on track and continue its upward trend within the next two years.

“It seems that for the next two years, we will see an upward trend in the capital market; Because some statistics show that the market follows a two-year pattern; it has been facing two years of recession from August 2019 to August 2022, now it is time for the market to experience two years of prosperity,” he explained.

The expert said the capital market needs political and economic stability for growth, which can be achieved by restoring the Joint Comprehensive Plan of Action (JCPOA).

“We should not expect the economic impact of the nuclear deal in the short term, and it may take more than a year for the positive effects to be manifested in the market,” he stressed.

According to the expert, global inflation, the increase in interest rates, as well as the inflationary pressure caused by increasing costs, have all resulted in the stock markets across the world facing serious challenges.

Pointing out that the world is moving towards inflationary stagnation, Safari said: “The positive cycle of the country's economy that should have been already started has been delayed due to internal and external political and economic shocks and we are still facing capital outflow.”

“Stability in the forex rates and economic policies helps the capital market. With stability in economic policies, export restrictions are reduced, currency transfer is easier and the cost of foreign trade exchanges is reduced for companies active in the stock market, ultimately leading to the growth of the stock market,” he said.

Source: Tehran Times