Checkpoint Systems, Nice Systems, Tech Sector Boost Israeli Currency Despite War

NEW YORK (TheStreet) -- The ceasefire between Hamas and Israel ended today when rockets were fired again at Israeli cities close to the Gaza strip. And peace talks in Cairo ended after the Israeli delegates didn't accept Hamas's terms to commit to open an airport and sea port in Gaza in the future.

Despite the ongoing war, the Israeli currency -- the New Israeli Shekel -- remains strong against leading currencies such as U.S. dollar and euro. What keeps the Israeli currency strong? And will it remain robust?

For one, Israel's strong tech industry continues to thrive, with companies such as Checkpoint Systems (CKP) and Nice Systems (NICE).

Nonetheless, these companies didn't perform well yesterday, as shares of Checkpoint Systems took a nose dive and fell by 3.5% to $13.56 a share. Nice Systems also shed 29 cents to settle at $39.20.

Israeli defense companies such as Elbit Systems (ESLT) have benefited from growing demand for their stocks as development in the region could improve their bottom line. Shares of Elbit rallied since the fighting started on July 8 by 2.5% to $60.86 a share (this includes yesterday's sharp drop of 2.5%).

The other issue is the Israeli cash rate, which remains relatively high compared to other leading economies. The U.S. cash rate is at 0% to 0.25%, and the European Central Bank lowered its cash rate to 0.15% and its deposit rate to a negative 0.1%.

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