Market report / Discount Bank stock unmoved by serial woes

Tel Aviv stocks gained ground yesterday, rising about half a percent following a surge in world markets as last week closed. The benchmark TA-25 index advanced by 0.6% to 1,064 points, and the broader TA-100 index gained 0.7% to 997 points. The Banks-5 index added 1.4%. Among the leading indices, only the Real Estate-15 index bucked the trend, losing 0.9%.

Total turnover was heavy for a Sunday, at NIS 1.4 billion.

On Friday the S&P-500 index closed at a 14-month high of 1,093 points, following a 2.3% gain for the week. European and Asian stocks also powered ahead on a combination of upbeat macroeconomic information and fairly robust corporate reports. Upbeat earnings news from major companies such as luxury goods provider Richemont more than outweighed weaker-than-expected U.S. consumer sentiment data, Reuters reported. Also Friday, oil dipped to $76.35 a barrel, after dropping as low as $75.57 a barrel, the lowest level since mid-October.

Equity analysts at Israel's biggest banks, Hapoalim and Leumi, expect the upbeat trend on the Tel Aviv Stock Exchange to continue in the short run, boosted by the improvement in the macroeconomic environment, unappealing yield levels on "safe" assets such as bank deposits, the strong third-quarter performance by Israel's companies, and the fact that while Israeli share prices may not be low, they also aren't high compared with their peer companies in the international markets.

Internet company Tapuz stock gained 0.8% after the company reported a 5% increase in third-quarter revenues to NIS 10.6 million. Sadly, though, its pretax profit sank to NIS 24,000 compared with NIS 1 million in the parallel quarter because it had to write off much of its investment in a startup called Get-It.

Delek Drilling stock shot up 5.2% after the company's announcement Thursday that it would be participating in two more production drills in the Mari-B8 and Mari-B9 permit areas. The total cost of the project to the Tethys Sea partnership, to which Delek Drilling belongs, is about $85 million.

Israel Discount Bank had a sea of troubles last week, from the watchdog's ban on the owners' attempt to oust chairman Shlomo Zohar, to the huge 12-million euro fine slapped on subsidiary Visa CAL by the international Visa group, after the Israeli company was found to have cleared transactions for drugs and erection-stimulant Viagra in contravention of the credit card group's rules. There could be other repercussions, including revocation of Visa CAL's international clearing license, Visa reportedly warned. Even so, Discount stock rose 2.2% yesterday.

Africa Israel stock sank 6.1% after the B9 series bondholders delivered a motion to the bailiff's office, demanding the NIS 557 million that the company owes them. Africa Israel had warned well in advance that it wouldn't make the payment, which came due last week.