The Tel Aviv Stock Exchange did not react much to the IDF's offensive in the territories or the political infighting that may signal the approaching end of the national unity government. At the end of the first day of the trading week, the leading indexes were up about 0.8 percent on low trade volume: the Maof index of 25 blue-chip shares gained 0.86 percent to close at 391 points, while the Tel Aviv 100 was close behind with a 0.83 percent increase to 377 points. Trade volume was only NIS 113 million.
Economists at Bank Leumi explain that recent events have only had a moderate impact on the local bourse because most of the investors are institutions or parties with vested interests, while individual investors play a more marginal role. In the U.S., on the other hand, the impact has been more dramatic since the public is more widely involved in stock investment.
The uncertainty in the U.S. will continue to influence Wall Street and corporate results, despite the positive atmosphere on the trading floors at the end of last week, Leumi analysts say. In fact, Leumi's forecast for the near future is not rosy: "The stock market is at a high level of risk and the trend is expected to be negative."
Discount Investments recorded the sharpest gain among Maof shares yesterday, closing up 3 percent. This follows a "buy" recommendation from the research department at Bank Hapoalim, based on an assessment that the share is currently trading at a 37 percent discount.
Elbit Systems, which soared 26 percent after the Sept. 11 attacks in the U.S. and slipped 10 percent last week, registered a 2 percent gain yesterday on trade volume of NIS 4 million.
Koor Industries continued to decline yesterday, despite the general market climb, losing 0.2 percent on a small trade volume. Tadiran Communications, which has reportedly offered to buy Elisra from Koor, finished 6 percent higher yesterday. (Elbit Systems has also made an offer for Elisra.)
The most active stock yesterday was Teva Pharmaceuticals, which gained 2 percent on a turnover of NIS 14 million. Machteshim Agan closed up 1.65 percent after announcing that it had completed initial registration in the U.S. of a new, environment-friendly pesticide that it hopes to market widely in the American market.
AudioCodes (Nasdaq: AUDC) made an inauspicious TASE debut yesterday, dropping 7.5 percent. The decline was expected, however, in view of the arbitrage gap that developed.
The share price of Retalix (formerly Point of Sale) rose 2.5 percent. The company announced the appointment of Moshe Stoltz as the new CEO of its StoreAlliance subsidiary. Stolz founded the Market Share research firm several ago and earlier worked in senior positions at Elite.
In its weekly survey, the research department of Bank Hapoalim writes: "There is no doubt than the murder of a minister in the Israeli government represents an escalation in the regional violence which, together with the security situation in the world, leads us to new peaks of uncertainty in the markets. The security situation and the economic slowdown in Israel and the world indicate that the low levels reached by the stock indexes three weeks ago may soon return."
The bank recommends to wait for this high level of uncertainty to decline before making any major changes to investment portfolios. Among the investments recommended by the bank's economists are defense firms, pharmaceutical companies, supermarkets and chemical industries.
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