What is the definite effect of electricity on the stock exchange industry?
According to Tejarat News, power outages in the hot season can be considered as one of the main problems of production and industrial units operating in the stock market. The result of this certainty is damage to producers, damage to raw materials and industrial equipment, increase in the final price of products and the like. On the other hand, the losses caused by the power outages of these producers in recent years have not yet been compensated, and this power outage again could jeopardize the profitability of these companies.
Currently, the news of industrial power outages has been announced. On the other hand, experts believe that industrial gas will be cut off in winter as well. That is, two risks in two different time periods, each of which can have a negative impact on stock trading.
Industries such as cement, petrochemicals and steel suffer from power outages. Because the production of these industries decreases and as a result, the profits of companies also decrease.
Of course, power outages can not be considered a 100% factor in the decline of the stock market, because the greatest impact is due to the psychological burden of this issue. That is, in the first place, the psychological burden has a negative impact on transactions, and in the second place, the reduction of production and lack of profits cause losses.
In general, it can be said that power outages can reduce shareholder confidence and somewhat obscure transactions. But this is temporary and will return to normal after a few weeks of trading.
Stock market losses with power outages
“Electricity and gas cuts affect various industries in the stock market,” Fardin Aghabzargi, a capital market expert, told Tejarat News. But in general, with the power and gas cuts, the total stock index also temporarily decreases.
“Electricity and gas outages are a temporary risk to the capital market,” he explains. This risk is declining in the first place, but after a few weeks, the market will return to normal. Industries such as steel, petrochemicals, cement, and electricity are all dependent on electricity. With power outages, the cost of products in these industries increases, and eventually companies and industries profit after a period of losses.
“One of the most important problems with this decision is the lack of a clear government plan,” he said. In other words, electricity and gas were not supposed to be cut off in the first place, but now the news of these outages has been announced.
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