Market Report

TASE Shares Rally as TowerJazz Hits High Note

Wall Street rises on Q3 growth stats.

Tel Aviv shares rose sharply yesterday, riding the crest of a wave created by Wall Street over the weekend. Semiconductor maker TowerJazz jumped close to 40% on news it had formed a joint venture with Japan’s Panasonic.

The benchmark TA-25 index climbed 1.2% to a close of 1,339.28 points while the broader TA-100 advanced 1.1% to 1,208.61. For a Sunday, without the presence of foreign investors, turnover was a relatively brisk 826.7 million shekels, thanks to active trading in Oil Refineries of 108.5 million shekels. The shares rose 2.8%.

TowerJazz finished up 39.9% on turnover of 36.4 million shekels on the Panasonic agreement announced on Thursday. The company said the JV, in which it will own a 51% stake, would increase its revenue by approximately $400 million a year and improving profitability when the agreement is signed in the second quarter of next year.

U.S. stocks jumped on Friday after the U.S. government said the economy grew at its briskest pace in nearly two years. The Commerce Department reported that gross domestic product grew at a 4.1% annual rate in the third quarter, a sharp upward revision from the prior growth estimate of 3.6%. 

The Dow Jones industrial average ended up 0.3% higher at 16,221.14. The Standard & Poor’s 500 Index gained 0.5% to 1,818.31 and the Nasdaq Composite Index 1.2% to 4,104.74. Europe’s broad FTSEurofirst 300 index closed 0.45% higher at 1,287.61, bringing its weekly gain to 3.6%, its biggest since late April.

Euro slides

In foreign currency trading, the euro posted some brief losses against the dollar after Standard & Poor’s stripped the European Union of its triple-A credit rating.

Against the shekel, the euro weakened nearly 0.25% to a Bank of Israel rate of 4.7960 while the dollar gained 0.1% to 3.5180.

Defense electronics firm Elbit Systems finished up 1.3% after it said yesterday that it was awarded follow-on contracts worth $229 million to supply battle- management systems to Australia’s Department of Defense.

OPKO Health jumped 5.5% after it reported on Thursday the completion of the sale of its stake in Sorrento Therapeutics, yielding it approximately $22 million and a 10-fold return on its 2009 investment.

Teva Pharmaceuticals dropped 0.7%. The European Medicine Agency did not make a decision last week, as had been expected, on Teva’s laquinimod, a multiple sclerosis drug it is developing with Sweden’s Active Biotech. Despite that setback, Teva is still hoping to launch the drug in Europe in 2014. 

Israel Chemicals rose 4% with 32.5 million shekels in shares changing hands. Lev Leviev’s real estate holding company Africa Israel Investments soared 9.4%.

Apart from TowerJazz, other tech gainers included LivePerson, the U.S.-Israel company offering companies services to keep in touch with customers on line, which ended the day up 7.1%; Camtek, a maker of equipment for the semiconductor industry, up 8.6%; and satellite equipment maker Orbit finished 4.7% higher. Orbit signed a collaborative pact with an unnamed Europe company and received an intial 3 million shekel order.

Among losers, Perrigo, the world’s biggest maker of generic over-the-counter drugs, fell 2.6% and EZchip lost 2.5%.

Reuters contributed to this report.

Dan Keinan