Tel Aviv stocks ended the Thursday session with mild drops, after a day of escalating violence and political uncertainty. But tech stocks retained their buoyancy throughout, ending almost 1% in the green.

Blue chips spent most of the session trading with a mild negative bias despite a wave of bomb attacks, news of a fire that destroyed the Israeli embassy in Paris, and the persisting economic uncertainty as the government rethinks an economic package that it rejected earlier in the week.

The aborted terrorist attack on the Pi Glilot fuel depot north of Tel Aviv, and the casualties in the Rishon Letzion suicide bombing Wednesday night led to mild drops on the Tel Aviv Stock Exchange, but no more.

The Maof-25 index inched down by 0.4% after starting the last day of the trading week sagging by half a point. The Tel Aviv-100 index fell by only 0.2%. Tech stocks finished the Thursday session with a 0.7% gain. The total volume of trade was moderate at NIS 220 million.

The uncertainty pervading the market had most investors sitting tight on the fence, however. The violence aside, another major uncertainty factor was that the Knesset has to revote next week on the government's economic package after turning it down on Tuesday.

As for the prime minister's move in axing ministers belonging to the Shas party, who torpedoed the government's economic plan in parliament, Rami Dror of DBM Investments says the markets like it. Ariel Sharon's move is perceived as an act of strong leadership, Dror says, attesting that the prime minister attributes so much importance to the economy that he is even willing to risk his seat.

The Ynet website today published speculation about the findings of the Rabinowitz panel, which is compiling recommendations about taxing capital market gains. The panel will apparently suggest gradually building up to a 25% tax rate on gains, starting in 2002. However, market players say, that assessment is already factored into share prices.

Drug giant Teva Pharmaceuticals (Nasdaq:TEVA) sustained its positive bias, inching down from a 1.5% morning gain to end 0.7% up. Turnover in Teva shares was enormous, the session's highest as usual at NIS 71.3 million. The generic drug giant's stock has been rising on a series of positive news items, including an upgrade from US Warburg from Hold to Strong Buy. The investment bank also boosted its price target to $81.

The banks attracted much attention this Thursday on news accounts that the watchdog, Supervisor of Banks Yitzhak Tal, ordered the banks to set aside no less than NIS 1.5 billion for doubtful debts incurred by beleaguered businessman Gad Zeevi.

Assessments are that the banks will have to set aside NIS 6 billion for doubtful debts during 2002, on top of the NIS 4.4 billion set aside in 2001.

The First International Bank of Israel, for one, posted an NIS 70 million loss for the first quarter after writing off NIS 294 million worth of bad debt. Nonetheless, FIBI5 shares were slightly over the flatline at Thursday mid-day, after a morning dip of 1%. They ended 1.3% in the red.

Bank Leumi shares finished down 2.3% on NIS 18.6 million volume of trade. But Bank Hapoalim saw its gains gradually increase to finish the day up by 1.6%.

Partner Communications (Nasdaq, TASE:PTNR, LSE:PCCD) sank by 0.8% on unusually high turnover of almost NIS 5 million despite a Buy recommendation from the Menorah Gaon investment house, with a price target of NIS 30.3 ¿ almost 30% above Partner's current trading level.

Ormat jumping by 1.4%, down from a mid-day high of 5%, after publishing a sunny first-quarter report yesterday. The company said it netted NIS 4.1 million, after five consecutive quarters in the red, during which it lost an aggregate NIS 66 million.

Paradigm Geophysical (Nasdaq:PGEO) finished with a slight 0.2% loss, after gaining 12% on Wall Street yesterday. The company yesterday advised of its takeover by Fox Paine for $100 million in cash, which prices its shares at $5.15. It ended trade on Nasdaq yesterday at $5 per share.