Market Report

Banks, Energy Stocks Lead TA-25 Out of Five-day Slump

Bank Hapoalim heads the charge as top Tel Aviv equities finally rally on Monday.

The TA-25 index snapped a five-day losing streak Monday, as banking and energy shares lifted the market higher. The dollar and euro both strengthened against the shekel.

The TA-25 blue-chip index closed ahead just over 1% at 1,328.69 points, while the broader TA-100 rose 1% to 1,192.19, on turnover of 1.23 billion shekels ($350.7 million).

Bank shares rallied in heavy trading, with Bank Hapoalim ahead 2.9% on volume of 74.9 million shekels ($21.3 million), making it the most active share of the day. Mizrahi Tefahot Bank finished 3.1% higher, Bank Leumi ahead 3%, Israel Discount Bank up 2.7% and First International Bank of Israel up 1.9%.

Among energy shares, the Leviathan partners all gained, with Ratio jumping 3.2%, Avner up 1.4% and Delek Drilling up 1.8%. Givot soared more than 9%.

Analysts said that despite the market’s pullback over the past week, the outlook remains strong for Tel Aviv Stock Exchange equities. “Low interest rates and the public’s returning to shares will support continued rises for the TASE,” said Eli Kadosh, chairman of the investments committee at Prico Investments & Risk Management.

“Shares are near their highs, but the markets aren’t inflated in any way,” added Harel Finance in its report. “We reiterate our assessment that, in the short-run, there will be weakness for technical reasons, but going forward the share market is the place to be in 2014.”

U.S. stocks rose Monday, rebounding from their worst week in months as large deals boosted optimism. But investors remained cautious ahead of an upcoming Federal Reserve policy meeting that may launch a wind down in the bond-buying stimulus program. The Fed’s two-day policy-setting meeting ends Wednesday.

In late morning New York time Monday, the Dow Jones industrial average was ahead 0.9% at 15,894.3, the Standard & Poor’s 500 gained 0.7%, to 1,787.92, and the Nasdaq Composite added 0.8% to 4,031.116.

Robust German data helped Europe shrug off some mixed Asian data on Monday. Britain’s FTSE 100, Germany’s DAX and France’s CAC 40  all overcame early wobbles to settle 0.3%, 0.4% and 0.5% higher, respectively, as they bounced away from two-month lows.

In foreign currency trading, the dollar strengthened by just over 0.1% to a Bank of Israel rate of 3.5070, while the euro gained 0.24% in value to 4.8339 shekels.

Prico's Yossi Fraiman cited an unexpectedly sharply decline in the November consumer price index, plus slowing economic growth. “All these support a reduction of the shekel rate and other measures to ensure exporters’ profitability,” he said.

In the fixed-income market, the Tel-Bond 20 index dropped 0.1%. The government’s Shahar bond for 10 years finished in a decline of 0.09%, raising its yield to 3.56%. Its inflation-index Galil bond for the same period dropped 0.1%, boosting its yield to 1.38%.

In TASE equities trading, B Communications dropped 3.6% and its Bezeq subsidiary fell 2.9% by closing time.

Among the top gainers in the TA-100 index, Yitzhak Tshuva’s Delek Group rose 3.7%; builder Ashtrom advanced 3.4%, as did Menorah Insurance. Clal Insurance gained 3.2%.

BioLineRx soared 17% after reporting the initial results of Phase 2 clinical trials for BL-8040, its treatment for renewed outbreaks of acute myeloid leukemia.

Reuters contributed to this report.

Nir Kafri