Market Report / Tel Aviv Shares End Higher for a Third Day

Israel Chemicals rebounds after Monday's fears that demand for fertilizer would fall.

Tel Aviv stocks rose for a third straight session Tuesday, led by strong gains for Israel Chemicals and Bezeq amid growing optimism about the world economic outlook.

ICL ended the day 2.4% higher and led the most actives, with NIS 82.6 million in shares changing hands. It made a dramatic U-turn from a 1.8% drop Monday, when the stock was pressured by reports of lower corn prices that would reduce demand for the company's fertilizer. Bezeq climbed 2.6% on turnover of NIS 30.7 million.

The benchmark TA-25 index and the broader TA-100 both ended 0.3% higher – at 1,199.00 and 1,080.32 points, respectively. But while the market was turning around after losses the two previous weeks, turnover remained in the doldrums – just NIS 872.9 million.

And the financial sector did poorly Tuesday. The TA-Finance index fell 0.5% to 1,102.05. Among the biggest losers were insurers Phoenix, down 1.7%, Harel, down 1.4%, and Clal, down 1.1%. Among banks, Israel Discount Bank and Bank Leumi both dropped 1.5%, the latter in heavy trading of NIS 33.2 million.

Bond prices were higher. The government's Shahar 10-year unlinked bond added 0.1% to yield 3.82%, while inflation-index Gallil series for 10 years added 0.32%, trimming the yield to 1.58%.

Inflation expectations have reached their lowest level since 2009 due to local and global factors, noted Ofer Klein, the head of economics and research at Harel Insurance & Finance. But he said the outlook for consumer prices was too low, which presents opportunities to buy bonds for terms of five to 10 years.

On Wall Street, the Dow Jones industrial average was up 0.3% in mid-morning at 15,017.56. The Standard & Poor's 500 Index was also ahead 0.3%, at 1,619.19, and the Nasdaq Composite Index was up 0.2% at 3,440.11. But the pan-European FTSEurofirst 300 closed 0.5% lower, and the Euro STOXX 50 fell 0.8% to 2,602.51.

The dollar hit a four-week high against the yen and rose to a five-week peak against a basket of currencies on expectations that U.S. jobs data will boost the chances the Fed will scale back stimulus measures soon. The euro dipped to $1.3026 and hit a low of $1.2989, approaching its lowest level since early June.

Against the shekel both currencies posted losses. The dollar weakened 0.2% to a Bank of Israel rate of NIS 3.6290, while the euro shed 0.35% to NIS 4.7284.

Among stocks, biotechnology company Protalix led the TA-100 higher with a 5.9% advance. Fashion retailer Fox was up 3.5%, extending gains on news it would sell apparel from U.S. brand the Children's Place. Biotechnology company Can-Fite surged 6.1% after it said the U.S. Patent and Trademark Office had approved its CF602 drug for inflammatory diseases.

Orbit Technologies, a maker of satellite communications equipment, jumped 10.7% in light trading after it received a NIS 10 million follow-on order from the Defense Ministry.

But losers included Photomedix, which slumped 2.4%, the sharpest decline among TA-100 stocks for the session. Allot Communication's ended down 2.3%.

Elco Holdings rose 1.5%. The company said Landmark Apartment Trust of America, the real estate investment trust in which it holds a 33% stake, had signed an agreement under which funds managed by Blackstone Group and IStart will invest $285 million. Landmark will use the funds to help it finance property deals.

With reporting by Reuters.

The Dead Sea Works potash fertilizer manufacturing plant belongs to Israel Chemicals.
Bloomberg