Tel Aviv stocks closed sharply lower Wednesday, with the benchmark TA-35 index finishing below 4,000 points for the first time since the end of January, Globes reported. The TA-90 fell 1.6%, with the two leading indexes shedding nearly 2% between them.
The drop cut across sectors. Bank and insurance indexes fell 1.5% and 2.5% respectively, defense stocks fell 2.3% – Elbit Systems lost more than 3% – and dual-listed shares fell about 1%, with NICE tumbling after its third-quarter report despite revenue and profit that beat analyst forecasts; the company also officially announced a workforce reduction.
The Tel Aviv Stock Exchange (Yaniv Morozovsky / CC BY-SA 4.0).
Analysts quoted by Globes pointed to an accumulation of uncertainty: the Democratic sweep in the U.S. midterm elections, President Trump’s announcement yesterday on halting U.S. military aid to Israel, and the foreign-interference investigation surrounding Israel’s own elections. Dual-listed stocks were also weighed down by earnings reports.
Eldad Tamir, CEO and owner of Tamir Fishman, told Globes that midterm results historically have no effect on U.S. market behavior, “but full Democratic control of both houses, together with the strengthening of the anti-Israel left within the Democratic Party, could certainly affect markets here for the worse and strengthen the dollar against the shekel.”
Oron Blutman, CEO of Analyst Mutual Funds, said the U.S. results reflect public opposition to Trump’s policies and negative sentiment toward American involvement in the region and support for Israel generally, raising investor concern about further erosion of U.S. backing – especially after the military-aid announcement. A constrained Trump could also focus the rest of his term on foreign policy, he said, raising the risk of further escalation with Iran. Blutman said October and the period since Israel’s elections already brought fund redemptions and a shift into safer assets: “Today is not exceptional, but mainly a continuation of the trend from the recent period.”
What it means for you: most Israelis own these indexes through their pension and savings funds, so a close below the watched 4,000 mark shows up in household statements – and if the analyst read is right, the pressure is about politics and the shekel, not one bad earnings day, which means it may not reverse quickly.
JBizNews Desk | Tel Aviv
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