Market Report / Gains are small for Tel Aviv stocks in very thin trading
Bezeq climbs 4.5%, banks fall 1.2%, TA-25 adds 0.1%.
Stocks rose slightly on the Tel Aviv Stock Exchange yesterday, but turnover continued to be quite low. Global markets rose once again and the euro rebounded on growing expectations that major central banks will act to bolster the world economy, following weak manufacturing data earlier this week highlighted the drag on growth from the euro zone debt crisis.
The cabinet's decision on Sunday to increase the budget deficit target for 2013 to 3% of GDP also weighed the TASE down yesterday.
The blue chip TA-25 index rose 0.1% to close at 1,079 points. The broader TA-100 index also gained 0.1% to end the day at 988 points. Almost all the major indexes were in the green for the day, though the Real Estate-15 index fell 1% and the Oil and Gas Exploration index dropped 0.7%. The TA-Banks index dropped 1.2%.
The market opened down but rose later in the day, though the market lost most of its gains as closing neared. The Biomed index climbed 1.9% and the BlueTech-50 index gained 0.5%. The TA-Insurance index jumped 1.4% after the Finance Ministry announced on Sunday that it was changing the rules on profit recognition concerning future claims, which will add to insurance firms' profits.
The TA-Communications index changed direction and rose for once, after being battered for months. Communications shares rose 0.5% yesterday as Bezeq pulled the index up, after gaining 4.5%. There was no specific event or announcement yesterday concerning Bezeq, but the share has fallen so far that it is considered undervalued, said analysts - and investors are returning. Turnover remained extremely low, as it has been all week, at NIS 650 million.
Large-cap corporate bonds continued their rise, after last week's announcement by the Bank of Israel that it was cutting July interest rates by 0.25% to 2.25%. The TelBond-20, -40 and -60 indexes rose by 0.1% to 0.3%. The TelBond-Shekel index also rose slightly, while government bonds were generally up slightly for the day.
Leading bank shares down was Israel Discount Bank, which fell 2.2%. Melisron lost 2.9% and Gazit-Globe fell 2.2%. Real estate shares have now lost 12% since April.
The dollar strengthened against the shekel yesterday by 0.15% and the representative rate was set at NIS 3.926. The euro fell very slightly against the local currency to a representative rate of NIS 4.940.
Shares that stood out yesterday included: Israel Chemicals, which dropped 1.9%; Partner Communications, which fell 2.2% and has lost 70% of its value in the past year; and IDB Holding, which fell 1.9% and now has a market cap of only NIS 600 million. IDB bonds also fell yesterday, with IDBH Series 3 bonds losing 5.9% and reaching yields of 75.6%.
The European Central Bank is expected to cut interest rates to a record low on Thursday but may need to do more to satisfy financial markets already starting to wonder about the solidity of last week's summit measures to tackle the euro zone crisis.
Reuters contributed to this report.