Market Report / U.S. Jobless Figures Boost TASE

The TA-25 index of blue chips advances 0.5% to a closing of 1,234.58 points, while the broader TA-100 finishes up 0.6% to 1,091.73.

Shares got off to a strong start for the week on the Tel Aviv Stock Exchange on the back of U.S. unemployment figures released on Friday, which showed the jobless rate at its lowest level since 2008 and lifted prices on Wall Street.

The TA-25 index of blue chips advanced 0.5% to a closing of 1,234.58 points, while the broader TA-100 finished up 0.6% to 1,091.73. Turnover was a low NIS 584.4 million. The gains for the TASE were across the board, led by the TA-Insurance index's 1.8% rise to 1,192.24: Migdal rose 2.8%, Menorah 2.3% and Clal Insurance 2.2%.

The TA-Banking index gained a more modest 0.7% to 1,131.50, with the First International Bank of Israel registering a 1.7% advance. Bank Hapoalim rose 0.9% and Mizrahi Tefahot Bank 1%.

U.S. companies kept up their slow but steady hiring pace in November, defying predictions that Superstorm Sandy would deal a big blow to the labor market, with the unemployment rate falling to a near four-year low of 7.7%. Non-farm employment expanded by 146,000 jobs last month after gaining 138,000 in October, the Labor Department said on Friday. The increase was well above the 93,000 expected on Wall Street.

The news was less than perfect: Many Americans gave up the hunt for work, and the government also reported a big drop in consumer confidence in December - the largest fall in more than one and a half years - and offered a cautionary note on the economy's health. Nevertheless, the Dow Jones Industrial Average and the Standard & Poor's 500 index ended Friday's session moderately higher - even if a steep drop in Apple's stock once again forced the Nasdaq Composite index to end the day in negative territory.

Even before the U.S. jobs figures were released, Bank Leumi said in its weekly comment on the TASE that the positive momentum the market has been enjoying is likely to continue for the near term against the backdrop of a more relaxed security situation, the upcoming election and "relative" optimism regarding the world economy. The market usually experiences a rally toward the end of the year, which should enforce the current trends. Nevertheless, Leumi economists warned that fourth-quarter corporate earnings will look poor compared to the previous quarter amid a slowing of the Israeli economy.

Among the biggest gainers in arbitrage trading, Teva Pharmaceutical Industries led the most actives on the TASE, with NIS 46.2 million shares changing hands on a 2.7% rise. Chip maker Mellanox finished up 2.5%, Ceragon Networks gained 1% and Cellcom Israel was up 2.2%. Not all technology shares joined yesterday's gain. Among the biggest decliners on the TASE was Babylon, which dropped 5.1% on heavy turnover of NIS 17.8 million. EZchip ended on a 1.8% decline and Allot Communications fell 2.9%. The TA-Technology index posted a gain of less than 0.1% to 345.40 points.

Africa-Israel, Lev Leviev's investment holding company, jumped 6% by closing as it stepped up efforts to buy back some of its bonds. Allium Medical soared as much as 11.78% before retreating to a daily gain of 4.3% after the medical device maker said it won European CE approval for a urinary stent. The TA-Biomed index was up 1.4% at 829.26.

In the bond market, the Tel-Bond 20, 40 and 60 indices all ended as much as 0.2% higher - capping a gain of 6% over the past two months. Elbit Imaging's Series Zion debt rose 4.6% in heavy turnover on news that the property investment company planned to buy back debt. Still, the bonds trade at yields of 36%, putting them firmly in junk territory.

Against that, IDB Holding Corporation bonds dropped 5.2% yesterday. Nochi Dankner's holding company reported late on Thursday that the option held by Argentinean investor Eduardo Elsztain to put another $75 million into Dankner's Ganden Holdings had expired.

Carasso Motors, whose shares have lost about a quarter of their value since June 2011, said yesterday it planned to buy back NIS 40 million of its stock. The shares ended 5.9% higher on the news.

Reuters contributed to this report.

Reuters