The Tel Aviv Stock Exchange fell sharply on Thursday morning, following global markets down after Chinese shares dropped, with trading on the Shanghai exchange was stopped for the second this week after stocks there fell by 7.3 percent.
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The TA-25 index of blue-chip shares dropped 1.8%, as did the broader TA-100 index. Bank shares fell by 1.1% and the Real Estate-15 index lost 1.7%.
Biomed stocks took a big beating, falling 4.4%, with a number of dual listed shares dropping even more: Mankind lost 13%, and has now lost 77% of its value since the share listed for trading on the TASE at the end of October; OPKO Health fell 7.5%; and Navidea Biopharmaceuticals was down 6.9%.
Corporate bonds were down too, with the TelBond indexes falling by up to 0.22%. Government were mixed, with 10-year shekel-denominated Shahar bond rising by 0.3% to a yield of 2.03%; while inflation-linked Galil government bonds fell by up to 0.27%, with yields reaching 0.52%.
The shekel lost ground too on Thursday morning, with the dollar moving only slightly at 3.939 shekels; while the euro rose 0.93% against the local currency to 4.277 shekels.
Other world markets reacted strongly to the Chinese market: Hong Kong lost 3.1%, Tokyo fell 2.3%, and Singapore lost 2.7%.
Oil prices fell to an 11-year low, and continued to falling - down to $33.20 a barrel in New York.
European futures fall
European shares fell sharply on Thursday after China accelerated the depreciation of the yuan, sending currencies across the region reeling and domestic stock markets tumbling.
The pan-European FTSEurofirst 300 index and the euro zone's blue-chip Euro STOXX index fell 2.3 percent and 2.5 percent respectively.
Germany's DAX dropped 3 percent, while Britain's FTSE 100 weakened by 2.3 percent.
The DAX and FTSEurofirst were both at their lowest level since early October, with the DAX some 20 percent below a record high reached in April 2015.
"It's looking pretty ugly. We've been scaling down equity positions. It's time to take a step back to re-evaluate the situation," said Andreas Clenow, hedge fund manager and chief investment officer at ACIES Asset Management.
The People's Bank of China (PBOC) again surprised markets by setting the official midpoint rate on the yuan, also known as the renminbi (RMB), at 6.5646 per dollar, the lowest since March 2011.
Stock markets in China, which is the world's second-biggest economy, were suspended for the rest of the day less than half an hour after opening as a new circuit-breaking mechanism was tripped for the second time this week.
Investors have expressed fears that the yuan's rapid depreciation could mean China's economy is even weaker than had been imagined.
The worries over China hit mining stocks particularly hard, since China is the leading global consumer of metals, with Anglo American slumping 8 percent while Glencore fell 5.6 percent.
Companies that export to China, such as carmakers, also fell sharply, with BMW down 4.9 percent.
"The extent of the slowdown in China is certainly a worry. Investor sentiment is very fragile at the moment," said Terry Torrison, managing director at Monaco-based McLaren Securities.
Hong Kong's benchmark stock index fell to its lowest since mid-2013 on Thursday, as panic from China's 7 percent market free-fall spilled over the border.
The Hang Seng index dropped 3.1 percent, to 20,333.34, the lowest close since July 2013.
The China Enterprises Index tumbled 4.2 percent, to 8,753.97 points, a closing level not seen since October 2011.
All main sectors fell, with sentiment soured by the fresh slump in mainland equities.