Tel Aviv Stock Exchange Ends Week With Losses Amid Global Tech Sell-Off
Translated & summarized from Calcalist by baba
The Tel Aviv Stock Exchange closed the week with losses, with the TA-35 index down 1% and the TA-125 index down 0.8%. Tower Semiconductor fell 5%, while Meitronics surged nearly 16% on a takeover offer from FIMI. Shamir Energy announced plans to build a 100-megawatt data center. Global tech stock declines, driven by AI spending concerns, impacted the Israeli market.
The story in 5 lines · by baba
- Tel Aviv Stock Exchange indices TA-35 and TA-125 closed down 1% and 0.8% respectively.
- Tower Semiconductor stock dropped 5%, marking its fifth consecutive day of losses.
- Meitronics shares soared 15.9% following a NIS 200 million acquisition offer from FIMI.
- Shamir Energy plans to construct a 100-megawatt data center in northern Israel.
- Global tech stock sell-off, fueled by AI spending concerns, negatively impacted the Israeli market.
The Tel Aviv Stock Exchange concluded the trading week with a negative close, mirroring declines in global markets, particularly in the technology sector. The TA-35 index fell by 1%, and the TA-125 index dropped by 0.8%. The banking sector also saw a downturn, with the TA Banks index decreasing by 0.8%, and Bank Leumi being the weakest performer in the sector, down 1.2%.
Tower Semiconductor was a significant laggard, falling 5% and extending a five-day losing streak. Conversely, Meitronics experienced a surge of 15.9% on exceptionally high trading volume, more than 21 times its monthly average. This jump followed an offer from the FIMI fund to acquire half of the company's shares for NIS 200 million, valuing the company at NIS 400 million before the investment. FIMI has been granted exclusivity for negotiations, pending shareholder approval.
In the energy sector, the TA Renewables index declined by 2%, with Enlight and Energix also experiencing drops. On a weekly basis, the TA-35 index was down 2.4%, and the TA-125 index fell 1.4%. Damari was the strongest performer on the TA-35 for the week, up 7.3%, while Tower ended the week with a more than 19% loss.
Meanwhile, Shamir Energy, the electricity generation arm of Mivtach Shamir, is entering the data center market. The company secured a ten-year exclusive option to use land in Kibbutz Ashdot Yaakov Meuhad for a 100-megawatt data center, which will be accompanied by a small power station or energy storage facility. This move comes as data center connection requests to the electricity grid total 27,000 megawatts, far exceeding the 1,000 megawatts planned under new regulations.
Global factors contributed to the downturn, with sharp declines in New York technology stocks due to renewed concerns about the spending and investments of artificial intelligence companies. Nvidia CEO Jensen Huang's comments about unprecedented demand for cloud services but also capital constraints impacting growth fueled investor fears. Wells Fargo analysts noted that Huang's warning heightened concerns that capital markets are reaching their limits for financing risky investments, a sentiment echoed by Meta's statements on AI's substantial funding needs.
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