Strong rally in real estate lifts indices

Tel Aviv stocks gained ground yesterday, driven north by a rally in the real estate sector. The TA-25 index advanced by 0.5% to 1,003 points, the TA-100 index gained 1% to 919 points and the TelTech-15 index jumped by 2.7%. Midcaps advanced and the index tracking finance-sector stocks rose by 2.2%.

However, the real gainer of the day was the Real Estate-15 index, which leaped by more than 5%.

Moreover, total turnover rebounded to a heavy NIS 2 billion. That was the average daily volume of trade in 2007 but during the summer weeks, daily trading turnovers had sunk to NIS 1 billion to NIS 1.5 billion.

Among the day's losers were Israel Chemicals, which lost 6.4%, and its parent company The Israel Corporation, which sank by 6.3%. The Israel Corporation's subsidiary ICG is buying 43% of the German biofuel company Petrotec, which makes fuel out of recycled cooking oil. But qualms at fueling one's vehicle with a substance faintly smelling of fish or falafel was evidently not the problem. The problem was the steep drop in commodity prices and sharp drops in potash stocks around the world. On Nasdaq, the Potash Corporation of Saskatchewan stock was down around 5% during trading in Tel Aviv, and Mosaic was losing 5.5%.

Meanwhile, Gustav landed on the Gulf of Mexico with a whimper. Yesterday crude prices dropped by more than $6.50 per barrel, the biggest drop in dollar terms since 1991, as dealers bet the U.S. oil industry would recover quickly from the hurricane. "It would take a really major storm to change the direction in crude oil in the midst of its major correction since July, and Gustav is not it," Chris Jarvis, a senior analyst at Caprock Risk Management in Hampton Falls, New Hampshire, told Reuters.

As for the real estate stocks here at home, among the day's gainers were Chaim Katzman's Gazit Globe, which advanced by 4.4%, and Alony Hetz, which shot up almost 10% (recovering some of the 29% it lost from the start of the year). Alony Hetz expects to post a NIS 20 million capital gain in the third quarter of 2008 on a selloff of assets by Brockton Capital, an English fund in which Alony Hetz owns a 25% stake. Brockton is selling a London office building for 38 million pounds.

Africa Israel Investments stock advanced by 4.4%. From the start of the year it's lost 60%.

Yesterday the last Israeli companies filed their second-quarter financials. The last to file are typically the worst performers. In the second quarter of 2008 the problem typically wasn't revenues, it was growing costs of financing. (As usual, some companies elected to file their reports at exotic hours. Bezeq stock gained almost 3% after its midnight filing and Ilan Ben-Dov's Tao Tsuot lost 2% after dishing up its report as dawn was stealing over the city, at 5:32 A.M.)

Koor Industries lost 0.6%. The company reported raising NIS 678 million through a rights issue to shareholders earlier this week.

Ormat Industries stock gained 3.8% on news that it filed candidacy to participate in the Negev solar power plant tender.

Willi Food stock gained 0.5% and Gilon Investments shares rose by 0.6%.