Market report / Tel Aviv stocks fall while global shares rally
Israeli market continues to tread water in a worrying way, one analyst says. Among stocks, LivePerson plunges after it loses $200,000 in the first quarter.
The Tel Aviv Stock Exchange stood aloof from global markets again on Thursday, ending lower for the day and week as world markets extended multiyear highs early in the day.
The TA-25 blue-chip index spent most of Thursday in the red and ended down 0.5% at 1,203.19 points. This left it 0.1% lower for the week and reduced its return for 2013 to a stingy 1.5%.
The broader TA-100 fell 1% to 1,076.17, leaving it down 0.4% for the week and up just 2.6% for the year. Turnover was NIS 1.17 billion. Even the TA-Midcap 50 index, the year's darling with a 21.1% return, ended 0.4% lower at 506.31, though for the week it was still up 3.6%.
"The local share market continues to tread water in a worrying way while other developing markets are in a positive trend," said Yaniv Pagut, chief strategist of Ayalon Group. "Worrying? We say yes. We ask ourselves what will happen to the local stock market when there's a global correction, as there will be."
A benchmark measure of stocks around the world slipped after setting a five-year high on Thursday, while the dollar strengthened in the wake of better-than-expected U.S. job market data. Investors took profits in major global equity markets, but relatively upbeat economic data and ongoing support from central banks kept equities near multiyear highs.
The MSCI world index, which tracks stocks in 45 countries, was down 0.4% after earlier hitting its highest level since June 2008. Europe's FTSEurofirst 300 index hovered near a five-year high and Germany's DAX and Britain's FTSE 100 rose slightly. The Standard & Poor's 500 Index was down 0.2% in the early afternoon New York time at 1,629.45, while the Nasdaq Composite Index was up 0.04% at 3,414.79.
The dollar strengthened against the euro and yen as demand for the greenback increased in the wake of better-than-expected initial jobless claims. But the shekel resisted the worldwide trend. The Bank of Israel rate for the dollar fell 0.22% to NIS 3.5560 while the euro slipped 0.13% to NIS 4.6726.
The central bank said Wednesday it had spent $530 million in April and May in an effort to shore up the U.S. currency against the shekel by intervening in the forex market. "This shows us the extent of the local foreign-currency surplus, and strengthens fears that without intervention by the Bank of Israel the exchange rate might easily have fallen below NIS 3.5, jeopardizing Israeli exports," said Yossi Freeman, CEO of Price Risk Management & Investments.
The TASE may well have ended lower except for sturdy gains by technology stocks led by Mellanox. The semiconductor maker jumped 2.1% as NIS 108.3 million in shares changed hands, making it the day's volume leader.
Other buoyant tech stocks included EZchip, which added 6.1%. The company said first-quarter net profit declined to $6.7 million, or 23 cents a share, from $7.8 million, or 27 cents, a year ago, on a non-GAAP basis. But it added that "all its NP-4 customers are now in production," while its NP-5 processor was on target to move into production next year.
Nice Systems, a maker of digital recording technology, and defense electronics maker Elbit Systems both advanced 2.4%. Ceragon, which makes backhaul equipment for cell phone operators, added 1.3%.
But LivePerson plunged 22.8%. The company said Wednesday it had lost $200,000, or breakeven on a per-share basis, in the first quarter, swinging from a net profit of $3.1 million, or 6 cents a share, a year ago. On a non-GAAP basis, it earned 6 cents per share. Analysts polled by FactSet had forecast an adjusted 7 cents a share.
Semiconductor maker TowerJazz ended down 6.9% after it posted a quarterly net profit excluding one-time items of $6.5 million, down from $32 million a year earlier. Revenues fell to $113 million from $168 million.
With reporting by Reuters and The Associated Press.