Market Report / TASE Ends Strong Month With a Rise

The benchmark TA-25 index finished with a gain for the day of 0.5%, leaving the index at 1,221.47 points, while the broader TA-100 added close to 0.6% to end at 1,090.67.

The Tel Aviv Stock Exchange ended a very strong February Thursday with solid gains. The benchmark TA-25 index finished with a gain for the day of 0.5%, leaving the index at 1,221.47 points, while the broader TA-100 added close to 0.6% to end at 1,090.67.

Turnover was an unusually high NIS 1.2 billion. Thursday’s gains brought the TA-25’s rise for the month to 3.75%, and its year-to-date return to just over 3%.

For the TA-100, the gains were even more impressive: a rise of 4.2% for the month and 4% for the year thanks to a rally in medium- and small-cap shares. The TA MidCap-50 index has jumped 11.4% this year and 6.5% in the last month alone.

“Anyone looking for a logical explanation for the optimism that has smitten stock-market investors in the last month won’t find it in the lukewarm financial results companies reported,” said Yaniv Fagut, chief strategist at the Ayalon Group.

“He’ll have to settle for explanations based on the low yields prevailing in the bond market. The low yields are pushing the public into increasing their risk in the race after better returns,” he added.

The TASE tracked the global equity markets, which were pulled higher Thursday by encouraging U.S. economic data and renewed confidence that major central banks will keep taking steps to support the global economy. Wall Street opened mostly higher, following gains in European stocks as fresh signs of central bank support led to a recovery of losses caused by Italy’s postelection political deadlock.

In Europe, the FTSEurofirst 300 index of leading regional shares was up by 0.7% to 1,168.9, while MSCI’s all-country world equity index rose 0.5% to 354.56.

The dollar rose against the euro and yen as investors embraced its safety against the backdrop of the Italian stalemate, and less than 24 hours before automatic spending cuts are enacted in the United States.

Locally, the dollar and euro both lost heavily against the shekel. The dollar weakened more than 0.5% to a Bank of Israel rate of NIS 3.708, while the euro lost about the same percentage to a fixing of NIS 4.8629.

Yossi Fraiman, CEO of Price Risk Management, attributed the weakening to an oversupply of foreign currency around at the end of one month and the start of another, as businesses repatriate forex to pay local expenses.

“In our view, at about the level of NIS 3.65 [to the dollar] the Bank of Israel will again intervene in the market,” he said. “In the first stage it will do that by way of statements and warnings of the kind that have so far been sufficient to put a brake on the shekel’s appreciation.”

Teva Pharmaceuticals fell nearly 1% as some NIS 309 million in shares changed hands, making it the most active share by far Thursday.

Israel Chemicals also traded heavily, with more than NIS 60 million in turnover, gaining 1%. Its parent company, The Israel Corporation, did better, adding 3% by close. ICL has recovered after dropping on remarks by a top Potash Corporation of Saskatchewan executive that the Canadian company was putting off efforts to buy control of the company because of the uncertain political situation in Israel. The market has since reassessed those remarks.

Among other top gainers, the biotechnology company Evogene jumped 8.2%, making it the top gainer among TA-100 stocks Thursday. Not far behind was the Internet company LivePerson, which ended Thursday’s session ahead 4.1%. Allot Communications posted the biggest drop among TA-100 stocks, with a 3% decline.

Clal Insurance rose 0.7%. The insurers said it would be paying shareholders NIS 120 million, which will be a much-needed cash infusion for Nochi Dankner’s IDB Development Corporation, which, as a 55% shareholder in Clal, will get more than half the amount.

Reuters contributed to this report.

Guy Raivitz