Market Report

Tel Aviv Shares Cautiously Extend Two-year High

Investors were waiting for the Bank of Israel’s decision on interest rates, which will fall a quarter point.

Tel Aviv shares rose Monday in brisk but nervous trading, a day after the benchmark TA-25 index struck a two-year high.

Investors were waiting for the Bank of Israel's interest-rate decision for October, which was scheduled to be announced after the shortened trading day was over at 2:30 P.M. In the event, the central bank took the market by surprise, announcing a quarter-point cut to 1%.

The dollar, which had been gaining on the shekel before the announcement, adding 0.3% to a Bank of Israel rate of NIS 3.5150, appreciated even further in late trading. At 7:15 P.M., the greenback was at NIS 3.5271. The euro, which advanced 0.1% to a Bank of Israel rate of NIS 4.7495, was trading at NIS 4.7585 late in the day.

The TA-25 blue-chip index ended 0.7% higher at 1,261.54 points, although it was well off its high of 1,277.59 in the late morning. The broader TA-100 also posted a 0.7% rise, to 1,137.66, with technology and biomed stocks pacing the advance. Turnover was NIS 1.41 billion.

The performance by Israeli stocks and the shekel stood in sharp contrast to global equity markets, which fell Monday as nagging uncertainty over the Federal Reserve's policy stance offset an election triumph for German leader Angela Merkel and upbeat euro zone and Chinese data.

The euro took a tumble after European Central Bank President Mario Draghi said euro zone interest rates would remain at current or lower levels for an extended period of time.

In late morning New York time, the Dow Jones industrial average was down 0.5% at 15,380.22. The Standard & Poor's 500 and the Nasdaq Composite indexes were both down 0.6% at 1,699.37 and 3,751.71, respectively. European shares on the FTSEurofirst 300 finished down 0.5% at 1,255.93.

Back in Israel, Given Imaging was the top gainer on the TA-100, advancing 5.4% after it said Japan's Pharmaceuticals and Medical Devices Agency had granted approval for the PillCam SB 3 system. The company expects to begin recognizing sales of PillCam SB 3 in Japan in 2014.

Evogene, a plant genomics company, rose 4.2% after it announced a three-year extension of its research collaboration agreement with Syngenta to identify plant genes resistant to Soybean Cyst Nematode.

TowerJazz, a semiconductor maker for other companies, rose 2.2% after it said it had begun volume shipments of light-emitting driver, or LED, integrated circuits to Korea's DMB Technology. Ceragon Network climbed 5% after it said Idea Cellular, India’s third-largest mobile services operator, had awarded it a multimillion-dollar contract to modernize thousands of wireless backhaul connections.

Among technology shares, Mazor Robotics offset some of Sunday’s 9.2% plunge with a 3.7%. The maker of a device for performing spinal surgery had announced it seeks to raise $46 million in a secondary share offering on Wall Street. Defense electronics maker Elbit Systems extended Sunday’s gains, adding 4.6%.

The Bezeq share-price train screeched to a halt Monday, dropping 1.6% on turnover of NIS 117.9 million, making the stock the most heavily traded of the day. Other big losers were Clal Biotechnology and supermarket chain Super-Sol, both down 1.5%, and mall developer and operator Azrieli Group, down 1.4%.

With reporting by Reuters.

Emil Salman