The world economy will log its best performance in six years in 2017, but in Israel the pace of expansion will probably slow, the Organization for Economic Cooperation and Development said in its world economic outlook on Wednesday.
Global growth will accelerate to 3.5% in 2016 and 3.6% in 2018 from 3% last year while in Israel the rate will slow to 3.25% annually from 4%. Nevertheless, the OECD was bullish on Israel.
“Growth should remain strong in 2017 and 2018 despite the negative impact of the [shekel] appreciation on exports,” the OECD said. “Consumer spending is expected to pick up gain and become the main driver after a weak start to 2017.”
Inflation is also expected to return after two years of lower prices, which the OECD said will lead to interest rate rises. A sharp increase in public spending will not contribute much to economic growth but will put upward pressure on prices, it warned. (Dafna Maor)
Bank Leumi agrees to sells Tel Aviv main branch building for NIS 277 million
Taking advantage of record property prices, Bank Leumi said on Wednesday it was selling its landmark main branch building in Tel Aviv for 277 million shekels ($78.2 million) to property companies Canada Israel and Arco Real Estate.
Located on the corner of Herzl and Yehuda Halevy Streets, the building is in one of the most expensive areas in Tel Aviv but was listed on Leumi’s books at just 17 million shekels As a result, the bank will record a pre-tax capital gain of 260 million on the sale when it is completed. Leumi will continue to occupy the building for the next two years, under the terms of the agreement. Although its façade is more modern, the 6,300-square-meter building was constructed in the 1930s. The site has been zoned for a 20-story residential tower but a recent revision to the city’s master plan awards significantly more building rights and will be adjacent to a light rail station. (Michael Rochvarger)
Teva migraine drug clears another late-stage trial
Teva Pharmaceuticals said on Wednesday its experimental drug to prevent migraines cleared another late-stage study, setting it on course for U.S regulatory approval and launch in the second half of 2018. The drug’s success would be a much needed boost for Teva, Israel’s biggest company and the world’s largest generic drugmaker.
Analysts have estimated it could generate at least $1 billion in sales annually. The new migraine treatment, fremanezumab, significantly reduced the amount of headaches suffered by patients during a phase III trial in episodic migraine prevention using both monthly and quarterly doses, Teva said. The company also released positive results for the drug treating less-prevalent chronic migraines a week ago.
“Teva plans to submit a Biologics License Application to the U.S. Food and Drug Administration for fremanezumab later this year in both episodic and chronic migraine with anticipated approval and launch in the second half of 2018,” it said. Teva shares ended up 2.2% at 103.90 shekels ($29.34). (Reuters)
Tel Aviv shares advance as global markets steady
Tel Aviv shares ended higher on Wednesday as world markets steadied after nervousness the day before over the Qatari crisis and British elections. The blue chip TA-35 index climbed 0.25% to 1,427.42 points, while the TA-125 added 0.2% to 1,295.39, as 1.34 billion shekels ($380 million) in shares changed hands. Among top gainers, Property & Building Limited advanced 5.6% to 8.81 shekels, Norstar 4.7% to 71.55, LivePerson 4.3% to 39.11 and Ormat Technologies closed 3.65% higher at 212.90. Biomed shares were mostly lower, led by declines of 7.4% of Kamada to 2.690 and 3.1% for Mazor Robotics to 67.80. Maytronics slipped 1.2% after controlling shareholder Kibbutz Yizreel sold a 5% block of shares, cutting its stake to 60%. In foreign currency trading, the dollar strengthened slightly to a Bank of Israel rate of 3.546 while the euro lost 0.2% to 3.9767. (Omri Zerachovitz)