Market Report Israel Chemicals Weighs Down on Shares

As ICL share drop offsets the market, TASE benchmark index ends unchanged, but news of new BOI chief could have positive effect Thursday.

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The Tel Aviv Stock Exchange's benchmark TA0-25 index ended unchanged on Wednesday as the troubles at Israel Chemicals offset an otherwise higher market.

News that Prime Minister Benjamin Netanyahu was naming Bank Hapoalim Chief Economist Leo Lederman to head the Bank of Israel came after the TASE closed for trading, but news of the end of the uncertainty over the new governor should be a source of positive sentiment when the markets open Thursday.

ICL shares dropped 2.7%, only a fraction of the plunge they suffered the day before, as investors tried to calculate the impact of the breakup of the cartels that have kept potash prices high for the past decade. More than NIS 280 million in shares changed hands, accounting for nearly a quarter of the day's NIS 1.17 billion in trading. Its parent company, The Israel Corporation, fell just 0.7% on turnover of NIS 44.9 million.

The TA-25 ended the day at 1,203.47 while the broader TA-100 edged down a mere 0.08% to 1,094.04. Counterbalancing ICL was another day of strong gains for telecommunications stocks, with Bezeq adding 1.7% on turnover of NIS 67 million, Partner Communications rising 2.7% and Cellcom Israel 2.2%.

Stocks in the U.S. and Europe rallied along with the dollar on Wednesday after data showed the U.S. economy grew more quickly than expected in the second quarter and ahead of a Federal Reserve policy statement.

U.S. economic growth, as measured by gross domestic product, accelerated in the second quarter by a 1.7% annual rate, the government said. Economists had expected a 1% gain. But investors remained focused on potentially game-changing central bank policy decisions in the next 24 hours from the Federal Reserve, the ECB and the Bank of England.

Halfway through the New York trading day, the Dow Jones industrial average was ahead 0.4% at 15,584.80. The Standard & Poor's 500 Index was up 0.5% at 1,693.82. Europe's broad FTSEurofirst 300 index was finished ahead 0.2% at 1,208.17 though on track for it best month in over a year.

In foreign currency trading, both major currencies weakened – the dollar loosing 0.08% of its value to a Bank of Israel rate of NIS 3.5660, while the euro shed 0.2% to NIS 4.7269.

The online translation company Babylon extended its gains after reporting a strong second quarter earlier in the week, climbing 7.5% to make it the biggest gainer among TA-100 stocks. Delta-Galil, the apparel maker, surged 5.9% after it reported Wednesday that sales rose 39% from a year ago to $234.4 million in the second quarter, as net income attributable to shareholders rose 44% to $8.8 million.

Other big gainers included TowerJazz, the semiconductor company, which added 6.2% and Ezchip, which closed 3.5% higher. Among tech shares that ended lower, LivePerson dropped 3% and Nice System by 1%.

Biotech company Bonus Biogroup closed 8.9% higher after it said it completed construction of the world's first production facility for artificial bone implants. Insuline Medical advanced 8.7% after reporting it signed a collaboration agreement with a unit of the U.S. medical giant Johnson & Johnson to market its InsuPad product in Germany.

With reporting by Reuters.

The New York Stock Exchange logo stands above a board displaying stock prices shortly after the beginning of trading, July 30, 2013. Credit: Reuters



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