Dollar Briefly Tests 4-shekel Level

Ticker: Teva shares tagged a Sell after 55% run-up; Steinmetz in talks to take stake in JECmy.

Reuters

Dollar briefly tests 4-shekel level

The dollar briefly breached the 4-shekel barrier on yesterday as Israeli and global investors took refuge from Europe’s woes in greenbacks. The U.S. currency had retreated by the time the Bank of Israel set the official rate for the day at 3.9980 shekels. The euro, buttressed by investors choosing to take some profit on two days of dramatic losses tied to the Greek election, also posted a strong gain on the shekel, advancing almost 0.6% to a Bank of Israel rate of 4.4903 after touching a 12-year low on Friday. “Until the Bank of Israel returns to ‘play’ in the forex market, the shekel will be affected by global developments,” said Avichai Shoretzki, chief strategist for global markets at IBI Israel Brokerage & Investments. “As a result, it is expected to strengthen against the shekel and, so it seems, weaken against the dollar.” (Eran Azran)

Teva shares tagged a Sell after 55% run-up

After a 55% run-up over the past year, Teva Pharmaceuticals’ shares may be past their prime, the Hamburg-based securities firm Berenberg signaled in a report released Friday. Analysts Louis Pearson and Alistair Campbell initiated coverage on Teva with a Sell rating and a price target of $49, compared to a $59.88 closing in New York the same day. That makes them the first analysts to recommend off-loading the stock. Berenberg said insurers would likely force patients to switch from Teva’s bestselling Copaxone multiple-sclerosis drug to a generic rival likely to be approved later this year. It also said Teva would not have products for a wave of biological drugs due to go off patent by 2021 and that the company lacks other branded drugs to offset lost Copaxone sales. Teva ended up 0.3%, at 235.80 shekels ($59.08) in Tel Aviv. (TheMarker)

Steinmetz in talks to take stake in JECmy

Beny Steinmetz, the billionaire scion of a diamond-trading family, is in talks to take a stake in Jerusalem Economy Corporation, the key company in Eliezer Fishman’s business group, TheMarker has learned. He will likely be joined by several real estate investment funds. Among the options the two have discussed is for Steinmetz to lend 1.5 billion shekels ($380 million) to Fishman, who may be as much as 5 billion shekels in debt. JEC stock, which is being valued for purposes of the deal at 2 billion shekels, would serve as collateral. Fishman controls 68% of JEC, which in turn controls a host of other property companies including Industrial Buildings Limited and Mirland. The talks come as JEC shares have plunged 50% in the past three months amid concern about Mirland’s exposure to the Russian property market. Shares of JEC, which confirmed the talks Monday without specifying the party, ended up 7.1%, at 15.30 shekels. (Michael Rochvarger)

Central bank leaves interest rate unchanged

The Bank of Israel said Monday it was leaving its key lending rate at a record low of 0.25% for February, which will be the fifth month at that level after two back-to-back cuts in the summer. The central bank said its Monetary Committee believes the current interest level supports the continuation of Israel’s economic recovery and the return of inflation to the target range. Although the shekel has appreciated against a trade-weighted basket of currencies, it remains 5.5% lower than in August and the Israeli economy is showing continued signs of recovery from the third-quarter downturn caused by the Gaza war, it said. (Eran Azran)

Tel Aviv shrugs off Greek election news

Like European markets, the Tel Aviv Stock Exchange ignored the victory of Greece’s leftist Syriza party to edge higher yesterday. The benchmark TA-25 index ended up 0.06%, at 1,460.44 points, while the broader TA-100 index posted a more respectable gain of 0.3%, to 1.279.65 points. Turnover was 1.51 billion shekels ($380 million). Africa Israel Investments led gainers on the TA-100, jumping 9.9% to close at 3.74 shekels. IDB Development Corporation advanced 7.7% to 1.23 and Kenon Holdinhgs, the spin-off conglomerate from The Israel Corporation, rose 4.4% to 68.98. But gas stocks pulled back after a Sunday rally: Delek Drilling ended down 3.2% to 14.06 while Avner lost 3.1% to 2.60. (Eran Azran)