From the beginning of July 2003 to August 10, 2003, the Maof index has lost 13.4 percent of its value. Yesterday the negative sentiment stepped up a notch as fighting between Israeli and Hezbollah escalated on the northern border with Lebanon, as the guerrilla group fired missiles on Shlomi.
Since the beginning of July, when the Maof index reached 447 points, it has fallen 13.4 percent. At the same time, the shekel-dollar exchange rate climbed 4.4 percent. Market indexes have withdrawn to the levels of May 2003, before June's climbs.
The Maof index went down 2.5 percent to 387 points. The broader Tel Aviv-100 index has lost 2.6 percent. Tech stocks have retreated by 4 percent and the bank stocks fell 3.5 percent.
Bonds slipped yesterday, too, with the longest-term bond falling 0.9 percent.
Traders attribute the slump to rising fears that the Israeli-Palestinian cease-fire will collapse, coupled with profit-taking by institutionals and foreigners repatriating their money as yields on U.S. T-bills regain ground. Also, the ardor among foreign investors for the Israeli treasury's economic program has been cooling.
Nor are the upcoming debates on the budget for 2004 cause for enthusiasm, traders note.
Meanwhile, the shekel has been slumping against the dollar, which is surged to NIS 4.47 against the shekel in options trade yesterday. Its level, as reflected by the shekel-dollar options, is 4.3 percent above its level at the start of June, which was NIS 4.294.
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