Early Elections Announcement Sends Down Tel Aviv Stocks
Tel Aviv stocks sharply turned direction downwards in mid-afternoon trading Monday, after the coalition leaders unanimously agreed to hold elections on April 9. While Israeli shares had been mixed with a negative bias in early afternoon following a 5% drop by Israeli large-caps the day before, the announcement seems to have spooked local investors, at least to some degree. The large-cap index,TA-35 and the broader TA-125 are both down 1.7% and smller-cap indices are losing about 0.9%.
Bonds are down 0.3% in mid-session Monday, after losing 1.2% on Sunday.
In the morning, stocks were mixed with a negative bias. Several company owners had taken advantage of Sunday’s downturn to pick up stock on the cheap. One such for instance was the controlling shareholder of the real estate company Emilia, which dropped by 5% Sunday on turnover of 5.8 million shekels. So it turns out that Oded Feller had bought all Emilia shares on offer.
Igal Dimri, controlling shareholder of the construction company Dimri, bought half a million shekels’ worth of his company’s stock on the market Sunday, increasing his stake to 67.07%; Hanan Mor, owner of the Mor construction group, also bought half a million shekels’ worth of his company’s stock.
Teva reversed to a loss of 0.2%, from a mid-day gain of 0.7% following its 8% tumble on Sunday. Fellow drugs company Perrigo is hovering at the flatline, with slight gains, after losing 29% on Sunday.
Israeli stocks sank hard Sunday after Wall Street closed the week with sharp drops. Not only did the angst on the Street infect world capital markets: there are a lot of dual-listed companies in Tel Aviv and New York, and there’s no trading Friday in Israel. So, a lot of companies began Sunday with wide arbitrage gaps that technically had to close.
What the week will bring is anybody’s guess, but Zack’s "ahead of Wall Street" pointed out Friday that even given the slight uptick in futures, the market is on track to its worst December in 87 years, "back when Charlie Chaplin was charming movie audiences." That’s no laughing matter.
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