Iran’s Stock Market in Crisis Following the 12-Day Conflict

The Tehran Stock Exchange (TSE) has entered one of the most turbulent periods in its history in the wake of the 12-day war between Iran’s regime and Israel. The conflict, which brought direct military confrontation and heightened geopolitical risk, triggered a cascade of negative effects on Iran’s capital markets. This article provides a detailed analysis of the stock market’s condition after the war, drawing on facts and figures reported by various regime-linked media sources.

Attempting to Contain Panic

As the war erupted, the Tehran Stock Exchange was promptly shut down for nine consecutive trading days. This unprecedented closure was enacted under Article 23 of the Securities Market Law, which allows for the suspension of trading in emergency situations, subject to approval by the relevant regulatory council. The primary aim was to shield investors from extreme volatility and prevent a mass exodus of capital amid the uncertainty.

During this period, only fixed-income funds were partially reopened, allowing investors to access immediate liquidity for essential needs. While this move was considered a rational step to alleviate short-term financial pressures, it was ultimately a stopgap measure that did not address the underlying risks or restore confidence.

Bloody Day for Tehran Stock Exchange After 12-Day War: Billions of Rials Exit Market https://t.co/pThAl2SEH4 pic.twitter.com/1webJmhMtw

— Iran Focus (@Iran_Focus) June 29, 2025

Reopening to Red: A Market in Freefall

Upon the declaration of a temporary ceasefire, the TSE reopened—without any significant financial support or intervention from the authorities. The result was a dramatic sell-off:

• Over 99% of listed stocks traded in negative territory on the first day.
• The main TSE index plummeted by 62,503 points (2.1%), closing at 2,922,101.
• The equal-weighted index fell by 15,522 points, landing at 908,163.
• A record 35 trillion toman ($700 million+) sell queue formed, reflecting widespread investor panic and a rush to exit positions.
• Trading volume in retail shares was extremely low—just 2.63 trillion toman—signaling deep mistrust and hesitation among market participants.
• More than 750 stocks were locked in sell queues, with only 1% of stocks seeing buy-side interest.

This sell-off was so severe that it drew comparisons to financial markets in countries at war or facing acute economic crisis, rather than a market simply emerging from a brief period of conflict.

#Iran News:

Economy Plunges as Rial Hits Record Low and #StockMarket Suffers Sharp Declinehttps://t.co/7o6WlZsO10

— NCRI-FAC (@iran_policy) October 20, 2024

Lack of Support and Policy Missteps

One of the most heavily criticized aspects of the reopening was the absence of proactive support from the regime’s financial authorities:

• No reduction in price fluctuation limits (“price bands”) was implemented. In previous crises, these bands were tightened to limit daily losses, but this time, the standard 5% band remained in place.
• No significant liquidity injection was made by the government, central bank, or major institutional investors, despite expectations that at least 30-40 trillion toman would be deployed to stabilize the market.
• The regime’s economic officials, including the new Minister of Economy, insisted on reopening the market quickly but failed to coordinate effective support measures.
• The only notable intervention was the activation of the Market Stabilization Fund, which began limited purchases but was unable to stem the tide of panic selling.

Market analysts and investors widely condemned the regime’s passive approach, arguing that a combination of tighter price bands, robust liquidity support, and clear communication could have cushioned the blow and restored some measure of confidence.

The burst of #Iran’s stock market bubble and the disappearance of people’s money in the capital market has been a topic of discussion and criticism by the media and government experts.https://t.co/eKvnIg2gtF

— People’s Mojahedin Organization of Iran (PMOI/MEK) (@Mojahedineng) April 21, 2021

The Scale of the Crisis

The numbers from the first trading day after the war underscore the depth of the crisis:

• Total trading value reached 13.57 trillion toman, but only 28% was in retail stock trades.
• Outflows from fixed-income funds exceeded 192 billion toman, as investors sought safety.
• Over 2.4 trillion toman in real money left the market, further draining liquidity.
• 96% of stocks were in sell queues; only 1% were in buy queues.
• The market’s total capitalization shrank sharply, with the main index falling below the critical three-million-point threshold.

The situation was exacerbated by the suspension of major stocks such as Iran Khodro and Saipa, which was a last-ditch attempt to prevent even steeper declines in the main index. While this move slowed the fall, it did not address the root problems.

Iran: New Scandal at Tehran’s Stock Exchange Market

On September 29, the CEO of Tehran’s Stock Exchange Market resigned after it was revealed there were dozens of cryptocurrencies miners discovered in its basement.#Iran #Econom

https://t.co/d9G0cr4Txe

— NCRI-FAC (@iran_policy) October 1, 2021

Psychological and Structural Fallout

The crisis has both psychological and structural dimensions:

• Investor confidence has been severely damaged, not only by the war but by the regime’s inability to manage the reopening effectively.
• The lack of clear crisis management and communication has left investors feeling abandoned and exposed.
• The market’s liquidity and depth have diminished, making it harder for investors to buy or sell shares without moving prices.
• Analysts warn that unless the regime takes decisive action, the market could face a prolonged period of instability, with continued outflows and low trading volumes.

#Iran regime attacks protest by investors whose funds were swindled. #FreeIran pic.twitter.com/2EGIf6xRem

— NCRI-FAC (@iran_policy) June 18, 2017

Looking Forward: What Needs to Change?

Experts and market participants have outlined several urgent steps for the regime to restore stability:

1. Activate and expand the Market Stabilization Fund to provide meaningful buying support.
2. Temporarily reduce price fluctuation limits to prevent extreme daily losses and curb panic selling.
3. Inject substantial liquidity through coordinated action by the central bank, government, and institutional investors.
4. Communicate transparently with investors about the steps being taken and the outlook for the market.
5. Consider extending trading suspensions or targeted halts for highly volatile stocks until conditions stabilize.

Without such measures, the risk is that the crisis will deepen, eroding what little trust remains in Iran’s capital markets and further damaging the broader economy.

The 12-day war between Iran’s regime and Israel has left the Tehran Stock Exchange reeling. A nine-day shutdown, followed by a chaotic and unsupported reopening, triggered one of the worst sell-offs in the market’s history. The regime’s failure to manage the fallout has shattered investor confidence and left the market in a state of prolonged distress.

This wasn’t just a market failure—it was a regime failure. And for millions of Iranians, it’s one more reminder that the system is incapable of reform, let alone economic stewardship.