The Tel Aviv Stock Exchange closed down 1.3%, after a thin day of trading during which total turnover only reached NIS 236 million. Today marked the third consecutive day of losses at the Exchange.
The market opened slowly rising 0.5% and then falling back down to a moderate decline.
That mood lasted until noon, but just afterwards sales orders came in causing the Maof-25 index to drop 1.5% by 14:30. Traders think those selling are mainly foreign funds that are getting cold feet due to Israel's problematic security situation and its scheduled February 6th election for a new prime minister
The Nasdaq opening, which showed 0.3% gains, caused the local indices to climb up to a negative level of 0.9%, but just before the TASE close, the negative trend overtook the Israeli market again.
The Scitex Corporation (Nasdaq:SCIX) attracted a large, NIS 4.5 million turnover and shed 0.8%. In recent days there have been a flurry of reports claiming that several organizations are looking to acquire control of the company from the Recanati family.
Maof-25 index speculators exploit pessimism in synthetic contracts
The Maof-25 index closed down 1.3% to 448.9 points, its lowest since December of 1999. The TA-100 index lost 1.11% to 440.75 points. The Tel-Tech technology index fell 0.7%.
Noting today's low turnover, DBM Investments CEO Rami Dror feels that the repeat of Merrill Lynch s Underweight rating for the Israeli market probably served as a further catalyst in the market's fall. The US investment house analysts said that although yesterday's interest rate cut was a good move, it is unlikely to help the domestic market pick up its pace. At the beginning of the week, Merrill Lynch downgraded its rating of the Israeli capital market. That came as polls showed that right-wing Likud candidate Ariel Sharon's bid for prime minister is likely to be successful.
In contrast to the traders, Dror believes that the majority of today's sales activity did not come from foreign investors. He points to the low turnover and the lack of any unusual activity in dollars. Instead he feels that Maof speculators simply took advantage of the pessimism in the synthetic contract market.
Bezeq shows high volume, Makhteshim Agan intends to enter Japan
Israel's national phone carrier Bezeq was today' high-volume stock, trading down 2.2% on a NIS 36 million turnover. Bezeq opened up 1%, but Merrill Lynch says its Underweight rating for the Israeli market will probably hinder Bezeq's privatization efforts.
Makhteshim Agan today rose 0.2% on NIS 8.5 million. The rise follows a report published earlier this morning saying that the firm intends to enter the $3.5 billion Japanese agrochemical market, which is considered one of the world's largest, by acquiring a Japanese firm. Meanwhile, Makhteshim also plans to reduce it South American sales.
Baran gains 4% on Tower Semiconductors deal
Tower Semiconductor (Nasdaq:TSEM) shed 9.2% after the company warned that its sales in the first half of 2001 will be low. Tower yesterday beat expectations by reporting a fourth quarter income of $29.2 million and earnings of $1.4 million. On Wednesday the company is to lay the cornerstone for its new Fab 2 factory in the Israeli town of Migdal Ha'emek. Tower's sales warning has also affected its parent firm, The Israel Corporation, which dropped 2.2%.
In contrast, Baran rose today 3.2% on NIS 5 million. The stock opened by falling 4% on earlier reports that it may cease connecting Yes Satellite television subscribers, due to a NIS 50 million debt. The stock later picked up, after it became known that the firm will set up Tower Semiconductor's new plant, a project worth NIS 170 million over the next 18 months.
Isramco undergoes an upwards correction
Another story affecting Baran was published in the Israeli newspaper
. The report says Baran is looking to acquire 20% of Azorim Properties, from the Azorim group, at a company valuation of $110 million to $130 million. Azorim Properties' stock, which trades at an $81 million valuation, rose 2.5%, while Azorim finished down 0.1% .
After losing 13% since the beginning of the week, Isramco's participating unit today bounced back, finishing up 1.8% on a NIS 3 million turnover. Its plunge began earlier in the week, after the Israel Electric Corporation's announced its decision to purchase the majority of its gas needs from Egypt, instead of from the other contenders: Isramco and British Gas and the Tethys Sea partnership.
Drops in Avner and Delek Drillings continue
In contrast, the Tethys Sea partnership's stock has continued to fall, with Avner losing another 2.1%. Avner has lost over 20% since the beginning of the week. Delek Drillings, which in the last two days shed over 30%, lost another 3.3%.
Two of today's winners include Retalix (Nasdaq:RTLX), which gained 5.7%, and Metalink (Nasdaq:MTLK), which jumped 7.3% on a high, NIS 3.5 million turnover. Speculators believe that the Metalink rises are due to the company's accumulation of index funds. Metalink is expected to list on the TA-100 in February, 2000. Elbit Medical Imaging (Nasdaq:EMITF) fell 6.1%, and Nice Systems (Nasdaq:NICE) lost 5.6% on a NIS 9.5 million turnover.