Strong shekel is sign of a strong economy, Kahlon says, amid concern about exports
At a special meeting that he convened on Monday on the effect of the strong shekel on Israel’s exports, Finance Minister Moshe Kahlon said the shekel’s strength is a sign of a strong economy. “The Israeli economy has concluded one of the best years in its history and the strengthening of the shekel is a direct result of strong economic data. Nevertheless, one cannot ignore the damage to exports,” he said, a reference to the impact of a strong currency in making the country’s exports more expensive to foreign customers in foreign currency terms or alternatively leading to smaller profits from revenues in foreign currencies. Kahlon called for steps to bolster Israeli industry and to boost long-term productivity in Israel. ”The Israeli government will not abandon the exporters,” he said. The dollar weakened further on Monday, closing down 0.38% at a representative rate of 3.679 shekels. The euro strengthened to 3.897 shekels, up 0.35%. Last week, the shekel reached an October 2014 high of 3.635 per dollar but has eased back to 3.70 following Bank of Israel intervention the past two sessions. It is also hovering near a 15-year peak against the euro. (Ora Coren, Moti Bassok and Reuters)
Clal Biotech’s Luc Therapeutics buys Ataxion of Massachusetts
Luc Therapeutics, a Cambridge, Massachusetts-based company specializing in psychiatric drugs and which is controlled by Clal Biotech, signed an agreement Sunday for the purchase of Ataxion, another biotech company based in Cambridge. The transaction will reduce Clal Biotech’s stake in Luc to between 20% and 24%, depending upon certain milestones provided for in the agreement relating to payments by drug giant Novartis to Luc for the development of a medication for the treatment of severe depression. If Luc meets the 3rd quarter 2017 targets, it will boost the value of the merged firm to $75 million. Ataxion is a privately-held company that develops drugs for the treatment of movement disorders such as essential tremor. Clal Biotech led the effort to have Luc buy Ataxion hoping that the combined firm — which will have four central nervous system drugs in the pipeline in a field in which few new drugs have been approved — would become a more attractive prospect for a further takeover. (Yoram Gabison)
Top TASE indexes slide by 1% on the day, with Tadiran Holdings diving 8.9%
Most of the leading indexes on the Tel Aviv exchange lost ground on Monday including the benchmark Tel Aviv 35, which slipped 0.95% to 1,429.67 points and the Tel Aviv 125, which slid 1.01% to 1,273.18. Trading volume for the day was 1.3 billion shekels ($353 million).This was a second day in the row of losses, which intensified with the opening of trade in New York. Bucking the trend in Tel Aviv was the Banks 5 index, which gained ground near the end of the day and closed at 1,603.93, a smidgen of 0.04% over Sunday’s close. The Communications and Information Technology index dropped 2.2% as shares of cellular service providers came under pressure. Teva Pharmaceutical Industries’ shares lost ground for the second day in row, closing 3.29% lower at 123.50 shekels on the bourse’s highest trading volume of the day. Tadiran Holdings plummeted by 8.9% to 89.05 shekels on financial results showing a 20% drop in sales in the fourth quarter of 2016 and a sharp drop in profits. Security system firm Orad, by contrast, reported that its profits for 2016 as a whole doubled to 17 million shekels. Its shares closed up 0.47% to 2.79 shekels.
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