Israeli shares ended broadly lower on Wednesday, with Israel Chemicals continuing to take its lumps from the government's plan to re-examine its policy on natural resources. But energy shares rose even after Prime Minister Benjamin Netanyahu said he planned to lower the ceiling on future natural gas exports.
The benchmark TA-25 index fell 0.4% to 1,223.83 points by the close, while the broader TA-100 index lost 0.3% to 1,099.92. Turnover reached NIS 1.06 billion even though TASE trading had been extended by one hour to 5:30 P.M. since Monday.
ICL slumped another 2.5% in heavy trading of NIS 130.9 million, making it the most active stock of the day. Its parent company, Idan Ofer's The Israel Corporation, dropped 3.3% as NIS 29.9 million in shares changed hands.
ICL, whose principal revenues come from mining phosphate and potash in the Dead Sea and Negev, has lost 7.6% since Monday. Finance Minister Yair Lapid announced on Monday that he had created a panel headed by Eytan Sheshinski to weigh changes to the government's royalty and tax take, a move that would almost certainly cut into ICL's profits. Israel Corp. has lost 11.3%.
Oil and gas stocks ran against the market trend, spiking higher following news that the government planned to increase the amount of gas allocated for domestic use over the next 25 years by 20% more than the Tzemach committee recommended last year.
Eran Junger, energy analyst at Migdal Capital Markets, said the decision would not significantly hurt the outlook for the Leviathan field, Israel's largest gas field. He also said it would not prevent the Australian company Woodside from becoming a partner in the field.
"While the Woodside deal was signed on the basis that the final conclusion of the Tzemach committee would be to export 50% of gas reserves, the partners in the field have since reported an estimated 2 trillion cubic feet of additional reserves," he said. "We believe that these clarifications remove the uncertainty that has clouded everything over the past few months, and will now move the development plans forward."
The TA-Oil and Gas index rose just over 1% to 1,184.19. Among the gainers were Givot, up 2.1%, Delek Drilling, up 1.7%, and Isramco, ahead 1.1%.
Global equities were flat while major currencies and commodities traded within recent ranges on Wednesday, as investors awaited a statement from the U.S. Federal Reserve that they hope will shed light on its next move.
The Fed is expected to leave its policy loose following a central bank meeting that will end late Wednesday. But it may hint it will start scaling back its bond buying later this year if the U.S. labor market continues to improve.
The MSCI world equity index, tracking shares in 45 countries, inched up 0.04%, and Europe's broad FTSEurofirst 300 slipped 0.2%.
In New York, the Standard & Poor's 500 Index was off 0.1% to 1,649.92 as the Nasdaq Composite Index gave up 0.08% to 3,479.31 at noon New York time.
The dollar shed 0.3% against the Japanese currency on Wednesday to trade around 95.08 yen. But it was little changed against the euro at $1.34 after the single currency touched a four-month high on Tuesday.
The dollar advanced on the shekel but remained under NIS 3.60. The greenback added less than 0.03% to its value, to a Bank of Israel rate of NIS 3.5950. The euro strengthened 0.1% to NIS 4.8145.
Nova Measuring Instruments dropped 7.2%, making it the biggest loser among TA-100 stocks on Wednesday. The company said its long-serving CEO, Gabi Seligsohn, planned to step down from his position on July 31. He will be replaced by Eitan Oppenhaim, executive vice president of Nova's global business group.
Teva Pharmaceuticals, the world's biggest maker of generic drugs, rose 0.7% on turnover of NIS 39.3 million. The U.S. Supreme Court ruled on Monday ruled that regulators can challenge deals between brand-name drug companies and generic rivals that delay cheaper medicines from going on sale. But the court rejected the Federal Trade Commission's request to declare that the deals should be presumed illegal.
Reuters contributed to this report.