Israel Economics

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TASE firm as world markets wilt

22.1.06 | 18:34 By Tal Levy
Tel Aviv stocks managed to demonstrate resilience in the face of the steep drops on Wall Street last week. Share prices opened as much as 1% lower but managed to claw back much of the lost ground to end with a negative bias.

The TA-25 index lost only 0.2% to 836.8 points and the TA-25 index finished unchanged at 857.9 points. The TelTech-15 index dropped 0.9%. Turnover slumped to NIS 820 million, still a respectable amount for a Sunday.

Most dual listed stocks had begun with negative arbitrage gaps. On Friday Nasdaq slumped 2.4% and the Dow Jones fell 2% after oil surged back up and disappointing fourth-quarter corporate results were released.

"The market has been showing strength for some time now. The weekend drop on Nasdaq was mainly for local reasons, such as poor reports from several companies, the rise of oil prices and threats by al-Qaida," says Rami Dror of Migdal Capital Markets. "The forces propelling the Israeli market are entirely different."

The high volumes of trade attest to intense activity, including by foreign investors, he points out, and the market expects strong fourth-quarter financial statements from corporate Israel.

The story of the day was the engineering company Baran, which shot up 11% after announcing it had won a $100 million contract to build offices and parking facilities for Intel in Kiryat Gat. It also won an $11 million contract to upgrade an oil refinery in Romania.

Blue Square gained 6.5% after reports that the company means to split off its real estate activities into a sister company that would list for trade on the Tel Aviv Stock Exchange. People attending a presentation by the CEO believe the restructuring could add 15% to 20% to Blue Square's share price.

Retalix (Nasdaq, TASE: RTLX) lost 1.3% on the day's heaviest turnover. Four funds sold the 430,000 Retalix shares they had received when selling TCI Solutions to Retalix in April 2005. UBS handled the distribution of the shares for the funds, selling some via Nasdaq on Friday and some in Tel Aviv today.

Makhteshim Agan (TASE: MAIN) gained 0.2% on announcing the establishment of a Chinese company that will sell raw materials and agrochemicals in China, which is estimated to have a $2 billion market for agrochemicals.

Ormat Industries advanced 3.6%: Clal Finance Batucha today raised its recommendation for the company to Outperform and set its 12-month price target at NIS 50, which was 23% above its opening level on Sunday morning. On Thursday, Ormat said its Wall Street-traded subsidiary Ormat Technologies had filed a shelf registration to raise up to a billion dollars in three years through offerings of stock, straight and convertible bonds, and warrants. Market sources surmise its shelf registration may be connected to the fact that Californian alternative-energy company Calpine has gone broke and may be forced to sell geothermal power plants, which is Ormat's area of expertise.

Teva (Nasdaq, TASE: TEVA) lost 0.7% after starting on a negative arbitrage spread of roughly that magnitude.

Shares in Bank Hapoalim (TASE: POLI) added 0.1% while Leumi (TASE: LUMI) added 0.3%.

Delek Real Estate added 3.9%: today the Tshuva group company announced an agreement to buy two buildings in Frankfurt together with partners for NIS 505 million, of 91.5 million euros. Delek Real Estate's part of the deal is NIS 200 million.

Alrov Real Estate has risen 213% this year: today's contribution was 13%, on turnover of NIS 7 million.

http://www.haaretz.com/hasen/spages/673400.html

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