TASE closes Thurs up 2.6% on Ramallah pullback, shekel strength - TheStreet

The Tel Aviv Stock Exchange closed its second day of gains with leading indices up 2.5% on NIS 200 million turnover.

Despite Nasdaq's decline yesterday, the market here opened up 1% which swelled as the hours went by. The fact that Euroepean markets traded mixed with Frankfurt and Paris losing 1% and London gaining 0.5%, didn't stop the northbound hike in which the Maof-25 hit a 2.9% peak at 391 points

The positive mood was sustained with the blue chip index closing up 2.6% and the A-100 up 2.3% and technology shares up 1.8%.

Investment bank Meitav noted that the most significant influence on the market today was the decrease in security uncertainty with the resolution of the Ramallah situation. Also, the UN Security Council decision to reject a Syrian proposal of a commission of enquiry into the events in Jenin, helped. According to the investment bank, those two events along with the continued drop in yields on shekel instruments as well as the shekel¿s strength, pushed the TASE into a sharp correction.

DBM CEO Rami Dror mentioned this morning that the Ministry of Finance published its May fundraising schedule. According to the announcement, the treasury plans just NIS 2.5 billion in funds, compared to the NIS 4 billion average monthly fundraising since the beginning of the year. The drop surprised market players, and could create excess demand for shekel instruments, and lower yields which reached 7% in this week's short term debt certificate tender.

Shekel instruments did drop with short term debt falling 0.1-0.3% and longer term certificates fell to 5.8-6.6%.

Bank shares saw lively trade today, correcting some of the recent declines. Bank Hapoalim rose 2.7% on NIS 18 million turnover while Bank Leumi climbed 3.9% on turnover of NIS 19 million. Bank shares have suffered negative momentum recently since their increased doubtful debt provisions hurt 2001 financial results, as well as taking ahit from the fraud at Trade Bank that hurt banking system credibility.

Bezeq gained 3.9% on turnover of NIS 6 million. The banks today asked the court to appoint a receiver for Gad Zeevi¿s shares in the state-run phone company. Analyst Yuval Ben Zeev of Leader DS said it has long been clear the banks intend to take such a step so he was surpised by the sharp gain in the share. Ben Zeev says a possible explanation can be found in that as long as Zeevi held the shares there was concern the banks would force himt o sell them to reduce his debt. Now the shares will be transferred to the banks and it is likely they will wait for an attractive price before selling the bloc.

Discount Investments gained 3.9% on NIS 13 million. TheMarker reported today that sources close to the talks between Tevel and the banks believe the banks will be forced to forgive some of the cable company¿s debt or take a stake in the company. Also, yesterday the company announced it expects NIS 40 million in capital gains on the sale of Albar for NIS 268.5 million.

Rating company Maalot lowered IDB Development¿s corporate bond rating and announced it is also examining the ratings of bonds from subsidiaries Clal Industries and Discount Investments. Nonetheless, IDB group shares posted sharp gains over the past two days. IDB Holdings gained 1.8%, and IDB Development added 3%, while Clal picked up a hefty 3.4%.

Tower Semiconductor (Nasdaq: TSEM) published its Q1 2002 financial results after trade in New York yesterday. The company posted a 47 cent per share loss, 3 cents higher than average analyst projections, amounting to $12 million. The chip maker¿s sales dropped 60% in contrast to the parallel quarter to $8.4 million. CEO Dr. Yoav Nissan Cohen said the market had reached a low point and orders are picking up already in the current quarter. The share gained 2% on the reports.

This morning Agis reported that subsidiary Clay Park received FDA approval for a generic drug aimed at a $40 million annual market, the only generic drug approved for that market. Agis has received two similar approvals in the past six months. The share gained 3.4% on NIS 2.5 million turnover.

Israel Chemicals gained 3.2% on NIS 9 million. The company announced it had acquired British potash manufacturer Cleveland Potash yesterday for $45 million.