Tel Aviv Stock Exchange Ends September With Gains Amid Mixed Sector Performance

The Tel Aviv Stock Exchange concluded September with a positive trend, as major company indices outperformed smaller ones. The TA-35 index rose 1.58% in September, bringing its year-to-date gain to 15.76%. In contrast, the TA-90 index fell 2.73% during the month, widening the gap with larger stocks. Insurance and technology stocks performed well, benefiting from a moderate inflation environment and a 0.25 percentage point interest rate cut by the Bank of Israel to 3.25%. However, the energy and real estate sectors showed weakness, negatively impacting the broader market.

The Israeli bond market experienced a downturn in September, despite the central bank's interest rate reduction. Rising interest rates and bond yields in the US and Europe, driven by inflation concerns and increased energy prices, also put pressure on the local market, particularly long-term government bonds. While long-term Tel-Gov bond indices led the declines, Tel-Bond indices demonstrated relative resilience with more moderate drops, many still showing positive year-to-date returns between 2% and 4%.

Despite market volatility, the primary market remained active in 2026, with 21 new companies raising approximately 7.8 billion shekels and achieving a post-IPO valuation of around 33.6 billion shekels. Pasternak Hemh raised about 70 million shekels in September, and BioHarvest became the fifth company to conduct a dual listing this year. The corporate bond market also saw significant activity, with companies raising about 17.7 billion shekels from the public in September, led by the banking system which raised 7.4 billion shekels for the month and 54 billion shekels year-to-date. The trend indicates continued investor demand and the debt market's role as a key funding source for Israeli companies.

The mutual fund industry continued its growth in September 2026 with net inflows of 6.4 billion shekels, bringing the year-to-date total to 53.5 billion shekels. Money primarily flowed into money market funds and local bond funds, with bond-focused funds raising 26 billion shekels net year-to-date, making bonds the industry's main growth engine. Funds investing in foreign stocks also saw inflows, while those focused on the local stock market experienced outflows, reflecting investor preference for more conservative investment avenues amidst interest rate conditions and market fluctuations.