The main index of Tehran Stock Exchange (TSE) plunged by more than 3% within five minutes from the opening of trade on Saturday, the first working day of the week in Iran, while the Iranian rial lost more of its value against the dollar and crude oil prices went up in international markets.

The drop is in reaction to the killing of Qassem Soleimani in Iraq two days ago which has increased the threat of a serious military confrontation with the U.S. amid a pledge by the Islamic Republic to take a "harsh revenge" for the general's killing.

The sharp drop accelerated to 4.36% by midday bringing the index to its lowest point since 2015. The long queues formed by anxious big and small investors, prompted the Securities & Exchange Council to call an urgent meeting which decided not to shut down the exchange, which was an option to prevent panic selling.

The Council also promised to support the capital market by using funds from the Market Stabilization Fund if required. Large investment companies and banks purchased 82% of the stocks being sold by smaller investors to help increase the value of exchanges and calm the market.

The value of the Iranian rial on the open market dropped to 136,000 rials against one U.S. dollar on the first day of the week; a three percent devaluation.

"The most important issue for the FOREX market and eventually the country's economy now is political calm," Donya-ye Bourse, a website dedicated to the capital market and investment, said in a commentary on Saturday.

The commentary added that tensions in the investment market will remain high for the time being due to heightened tensions between Tehran and Washington.

It also indirectly warned that talk of retaliation against the United states will not help the stock market and the economy.