Earnings Reports Dominate Trading on Tel Aviv Stock Exchange

Israel Chemicals rose 1.4% as is weighs $500 million dividend after 2Q profit plunges.

A tsunami of second-quarter earnings reports washed into the Tel Aviv Stock Exchange on Wednesday, bringing with it numbers both good and bad, but there was little evidence of all the news in the market's overall performance.

The benchmark TA-25 index ended the session barely changed, edging down 0.03% to a close of 1,200.47 points on turnover of NIS 962.2 million. The broader TA-100 was down by an even lesser margin, with a drop of 0.01% to 1,096.44.

Israel Chemicals was the focus of attention on Wednesday, with its shares advancing 1.4% on turnover of NIS 117.4 million. The company reported a 23% drop in second-quarter net profit, but that was outweighed by plans unveiled by the company to either pay a special dividend of buy-back shares of $500 million. ICL also said it was planning to list its stock overseas.

The Israel Corporation, ICL's parent company, performed even better, adding 3% to its share price.

U.S. and European stocks dropped on Wednesday and the dollar fell for a fourth day in a row as investors grew more concerned over when the Federal Reserve will start to wind down its stimulus program.

At mid-day New York time, the Dow Jones industrial average was down 0.6% at 15,432.33. The Standard & Poor's 500 was off 0.7% at 1,685.95 and the Nasdaq Composite Index went down 0.8% at 3,636.69.

The uncertainty over the Fed weighed on European shares as well, as did the guidance from the Bank of England. Europe's broad FTSE Eurofirst 300 index shed 0.3% and the MSCI world equity index was down 0.7%.

In foreign currency trading, the dollar strengthened a smidgen a day after the Bank of Israel intervened to weaken the shekel after it reached a two-year high. The greenback's Bank of Israel rate was set at NIS 3.5560, a gain of 0.08% on the Israeli currency. The euro appreciated 0.3% to NIS 4.7307.

"Speculators are exploiting the leadership vacuum at the Bank of Israel," currency trading FXCM said on Wednesday morning, adding that dollar weakness globally is exacerbating the trend. "There's no doubt that the shekel's appreciation will be the most burning issue for the incoming governor, and that he will need to act quickly, both with words and actions."

On the TASE, second-quarter earnings also lifted Given Imaging, which rose 7.1% to lead the TA-100 stocks higher. Non-GAAP earnings jumped 35% to 22 cents a share.

Ormat finished 3% higher after its Ormat Technology unit reported net income attributable to shareholders, excluding one-time items, was $18 million, up from $4.8 million a year ago, in the second quarter.

Nice Systems, whose software is used by companies to monitor telephone centers, dropped 1.3%. The company said it earned 61 cents a share in the second-quarter excluding one-time items, up from 57 cents a year earlier, which was below the range of 58 to 64 cent it had forecast. Revenue rose 4% to $225.2 million at the midpoint of the $220 million to $230 million it expected.

Magic Software, whose share price had rallied some 20% over the past month, plummeted 8.4% after it said on Wednesday that its non-GAAP net income for the second quarter dropped 7% to $3.8 million from the same period last year. 

Allot Communications reversed a sharp drop from the day to close 4.9% higher on Wednesday as Oppenheimer raised their rating to an Outperform from Market Perform with an $18 price target.

Reuters contributed to this report.

Bloomberg