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Shares End Higher in Thin Trading as Africa Israel Jumps 16%

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Tel Aviv shares rose yesterday, led by strong advances for Perrigo and Africa Israel Investments, tracking gains on Wall Street over the weekend. Turnover, however, was very low.

The benchmark TA-25 index finished the session ahead 0.4% at 1,293.42 points while the broader TA-100 rose 0.6% to 1,168.79. But just NIS 609.8 million in shares changed hands, a low figure even for a Sunday when foreign investors are mostly absent.

Africa Israel, the real estate holding company controlled by Lev Leviev, soared 16% by closing on turnover over NIS 26.4 million. The company reported no news during the trading day. Perrigo, the world's biggest maker of generic over-the-counter drugs, closed 5.8% higher even though it reported over the weekend that it was recalling 18 batches of liquid acetaminophen for infants because the oral syringe that comes with the medication may not have dose markings.

U.S. stocks rose on Friday after surprisingly strong manufacturing data overshadowed expectations that the Federal Reserve might reduce its stimulus earlier than expected.

Factory activity expanded around the world, several business surveys showed, with Chinese manufacturers reporting the fastest upturn in 18 months. The Institute for Supply Management said on Friday that its index of U.S. factory activity rose to 56.4 in October, its best reading since April 2011.

While the news underscored views that the Federal Reserve may be considering scaling back its stimulus sooner than some market participants have been expecting, it also gave investors surprising evidence of the manufacturing sector's strength.

U.S. stocks up

The Dow Jones industrial average rose 0.5% up to end at 15,615.55. The Standard & Poor's 500 Index gained 0.3% to finish at 1,761.64 and the Nasdaq Composite Index edged 0.01% higher to close at 3,922.04.

European stock markets eased off five-year highs, after fresh signs of corporate earnings weakness pegged back Royal Bank of Scotland and carmaker Renault. The pan-European FTSEurofirst 300 index closed down 0.3% at 1,289.52 points, slipping back from a five-year closing high of 1,292.73 set in the previous session.

In local foreign currency trading on Friday, the dollar advanced 0.2% on the shekel to a Bank of Israel rate of NIS 3.5270. The euro was sharply lower, shedding almost 0.8% to NIS 4.7666.

Communications shares were lower, with the TA-Communications index down 1.35% to close at 743.16 points, making it the only sectorial index to show any significant drop for the day. Bezeq fell 1.5%, Partner Communications 1.8% and Space Communication, the operator of the Amos satellites, extended its losses from last week to finish down another 3.4%, making it the biggest loser of the day among TA-100 stocks.

Among energy stocks, Globe Exploration jumped 48.5% after it reported "significant" signs of condensate gas (a precursor for oil) at its Ofek 2 drilling north of Moshav Nir Zvi. Ratio, a partner in the Leviathan field offshore Israel, rose 1.9%.

Babylon, the online translation company whose shares have been pounded by trouble with Google and Yahoo, its two biggest sources of income, rallied yesterday to end 5.6% higher. Nice Systems finished 1.9% down. in real estate, Alfred Akirov's Alrov Israel lost 1.7% and its Alrov Real Estate unit ended down 2.3%.

Super-Sol, Israel's biggest food retailer, rose 1% yesterday after two days of sharp drops the week before on poor third-quarter earnings. The share rebounded despite Leumi Capital Markets' cut of its target price for the stock to NIS 14.80 from a previous NIS 15.90. It remained at Market Perform rating.

Teva Pharmaceuticals continued its way lower yesterday, losing another 1.5% on turnover of NIS 55.5 million, making it the most active share of the day. The surprise resignation of CEO Jeremy Levin overshadowed better-than-expected third-quarter earnings for the company last week. Meanwhile, negotiations with striking unions at its Teva Tech plant, which makes raw materials for the company's best-selling Copaxone drug, collapsed late on Thursday.

Reuters contributed to this report.

Lev Leviev, controller of Africa Israel.Credit: Ofer Vaknin

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