Market report / Stocks ends week on upbeat note

Tel Aviv stocks rallied yesterday, in keeping with the trend in Europe, following a mixed week.

After a day flipflopping about the flatline, Israeli stocks finished with a positive bias. The benchmark Tel Aviv-25 index gained 0.3% to end at 1,156 points and the broader Tel Aviv-100 index advanced 0.3% to end at 1,091 points. Turnover was slightly about average at NIS 1.7 billion.

Summing up the week, the Tel Aviv-25 index gained 0.75% and the Tel Aviv-100 added 1%.

Corporate bonds were mixed yesterday.

In London, shares ended with a rise of 0.2%, driven by gains by pharmaceutical and mining companies that were moderated by a retreat in bank stocks. U.S. stocks trended strongly downward on a report dated Wednesday, that housing starts had dropped by 4% in December. On Wednesday the World Bank issued an estimate that the global economy would grow by 2.7% in 2010, accelerating to 3.2% in 2011. Last year the global economy contracted by 2.2%.

Of perhaps more immediate interest is the forecast by U.S.-based economist Nouriel Roubini that the world uptrend in stocks is likely to end in the second half of 2010. Asia and the developing economies are likely to sustain faster growth; parts of China and India are already overheating, Roubini said.

Over here, if anything's hot it's the oil and gas sector. After having gained 2,470% in the past four months, units of oil exploration partnership Modi'in rose another 9.1% yesterday. The company pulled off a NIS 20 million rights issue that took it of the Maintenance List of companies not in compliance with Tel Aviv Stock Exchange listing rules.

Foreign banks are lining up to extend credit to Israel's oil explorers. HSBC and Barclays will lead a lending consortium for Delek Drilling, shares of which gained 1.8% yesterday, and Dorgas. The banks are putting up a $450 million bridging loan to help develop the Tamar field of gas field, off the Haifa coast.

Also active in the local energy sector is Deutsche Bank, which will be lending to exploration company Isramco, units of which gained 3.2% yesterday.