TA-25 Index Sank Below 800 Points as Banks, Chemicals Retreated

Real Estate-15 index lost 2.2% as TASE tumbled; natural profit taking, say traders

For the first time in months, Tel Aviv stocks broke through the 800-point mark, on the downside. The Tuesday session began with losses that moderated after the opening, but gained momentum again in the afternoon. Last night the Nasdaq index retreated by 1%, creating negative pressure on dual listed stocks as Tel Aviv began.

The banks weighed heavily on the local indexes, but chemicals and real estate also started to retreat, and were followed by a long list of stocks. Ultimately the TA-25 index lost 1.3% to 798.3 points, and the TA-100 index fell 1.3% to 822.8 points. The TelTech-15 index dropped 0.9%. Total turnover finished at NIS 1.1 billion, which supports the theory postulated by Migdal Capital Markets dealer Rami Dror. This was not a panic, just some profit taking. Nir Peleg of Excellence-Nessuah agrees, adding that the Tel Aviv Stock Exchange is in waiting mode ahead of the elections.

Wall Street for its part is waiting for a speech from Ben Bernanke, the new Fed chairman. Specifically it's waiting for hints about the future. Bernanke is widely expected to raise U.S. interest rates in March, for the 15th time in a row, to 4.75%. Some believe that later he'll make 16th rate hike to 5%.

This goes to explain the retreat in the bond market, where long-term Shahars dropped about 0.2% and long-term Galils retreated by as much as 0.3%. In the forex market the dollar strengthened by 0.3% to NIS 4.718 and the euro appreciated by 0.4% to NIS 5.6128.

The bank stocks were in full retreat: Hapoalim lost 2.9% on a volume of NIS 64 million, an dbl dropped 2.5% on turnover of NIS 62 million. Bank Discount sank 1.6% and Mizrahi lost 2.5%. The banks index dropped 2.5%.

Looking at the dual-listed pack, Teva Pharmaceuticals (TASE, Nasdaq: TEVA) lost 0.3% on turnover of NIS 74 million. Nice Systems (Nasdaq, TASE: NICE) dropped 2.2% and Elbit Systems lost 1%. Some investors felt that Elbit Systems' pre-announced fourth-quarter results had been disappointing, given charges of $20-25 million that it faces on acquisitions and sundry. But the company also reported a $32 million deal with Portugal today.

The negative trend took Partner Communications too: it spend most of the day above water but succumbed, and lost 1.4%.

Perrigo was the only one of the six dual listed stocks on the TA-25 index to stay in the green: it rose 1.6%.

Gilat Satellite gained 1.1% against the trend. In two days it's risen by 4%, after yesterday reporting that profitability has been restored for the first time in five years.

Lipman Electronic Engineering (TASE, Nasdaq: LPMA) lost 2.6% despite yesterday reporting a $3 million follow-on project from its Mexican customer, a bank.

In the chemicals sector, Israel Chemicals (TASE: CHIM) lost 2.2% on heavy turnover of NIS 59 million and Makhteshim Agan sank 1.8% on turnover of NIS 86 million. Investors didn't seem persuaded by Deutsche Bank's recommendation to buy the stock and 12-month price target of NIS 22.

Real estate was not spared the woe: the Tel Aviv Real Estate-15 index dropped 2.2%. Delek Real Estate lost 4.2% and Gazit Globe dropped 2.4%. Alony Hetz retreated by a lesser 1.3%.