Iran-Israel Latest News: Israel’s stock market blasted to all-time highs Monday as the shekel charged ahead against the dollar on the first trading day after U.S.-Israeli strikes kicked off against Iran on Saturday. Shares in energy, finance, and defense firms powered the surge, even as government bonds dipped slightly and shekel volatility gauges spiked to levels not seen since the last big Israel-Iran clash in June. Investors shrugged off Iran’s missile fire, chasing hopes of a swift victory.
Who Sees a Quick Win in the Market?
Gali Ingber, head of finance studies at the College of Management near Tel Aviv, nailed the mood. Investors now plot the most optimistic path: a short campaign with big wins, maybe even toppling Iran’s regime. That could slash Israel’s risk premium, spark growth, cut interest rates more, and trim the budget deficit. Last week, Bank of Israel froze rates after two cuts, spooked by Iran tensions despite cooling inflation. Sergey Dergachev at Union Investment Privatfonds downplayed long-term hits to Israeli banks’ credit. He figures the back-and-forth fire won’t tank their spreads much. Markets bet hard on Israel coming out stronger.
What Drove the Stock and Shekel Surge?
The Tel Aviv 35 blue-chip index closed 4.6% higher, while the broader TA-125 jumped 4.8%. Energy, banks, and defense stocks led the charge to record peaks. The shekel leaped 1.5% versus the dollar, nearing a 30-year high from last month, stretching its 20% yearly gain. That flew against the dollar’s rise elsewhere. Finance Ministry sold 3.3 billion shekels ($1.07 billion) in bonds, drawing 20 billion in bids from local banks plus Barclays, Goldman Sachs, Bank of America, JP Morgan, BNP Paribas, Deutsche Bank, and Citi. Strong demand signals confidence, even with volatility up.
Why Do Some Warn the Rally Might Fade?
JPMorgan poured cold water on the shekel party. They doubt the dollar-shekel drop holds, noting Israel’s edge over oil importers but flagging risks. Iran’s missile limits ease direct threats, yet longer fights in Iran and Lebanon could strain budgets, jobs, and macro stats. “We stay on the sidelines, not chasing levels,” the bank said. Shekel gauges hit peaks, hinting markets price in too much sunshine. Still, Monday’s action showed raw optimism after strikes widened the conflict.
FAQs
Q: How much did Israel’s main stock indexes rise?
A: TA-35 gained 4.6%; TA-125 rose 4.8% to all-time highs.
Q: What was the shekel’s move against the dollar?
A: It jumped 1.5%, near a 30-year peak after 20% yearly appreciation.
Q: Which sectors led the stock gains?
A: Energy, financial, and defense company shares.
Q: What did the bond auction show?
A: 3.3 billion shekels sold with 20 billion in demand from big global banks.
Q: Why did Bank of Israel hold rates last week?
A: Fears of Iran confrontation outweighed easing inflation.
Disclaimer: This information is based on inputs from news agency reports. TSG does not independently confirm the information provided by the relevant sources.
