Tel Aviv Stocks Set to Rise on Wall Street Gains Led by Chip Shares

The Tel Aviv Stock Exchange is poised to open its final trading day of the second quarter with positive momentum following strong gains on Wall Street. The Dow Jones Industrial Average rose 0.6% to a record close above 52,000 points, while the S&P 500 and Nasdaq climbed 1.2% and 2.1% respectively, ending five consecutive days of losses. Although Israeli markets mostly advanced during the day, chip stocks initially declined sharply near the close, mirroring early weakness in New York. However, chip shares on Wall Street later reversed to gains, leading to positive arbitrage spreads for dual-listed Israeli chip companies ahead of the Tel Aviv open. Tower Semiconductor is up 7.9%, Nova 6.9%, and Camtek 2% in pre-market trading.

Yesterday, the TA-35 index fell 0.3% and the broader TA-125 slipped 0.1%, despite intraday highs of 1.5% and 1.7%. Sector-wise, real estate surged 2.9%, construction 3.2%, insurance 0.8%, and security stocks 1.1%, while technology stocks dropped 2%. Shares of Baladi plunged 9.5% and Neto Melinda fell 8% following Shufersal's strategic shift to import South American meat directly, bypassing suppliers. Chip stocks Tower, Nova, and Camtek declined 6.2%, 5.5%, and 3.5% respectively during the day. Real estate stocks showed strength with Aura up 7%, Azorim 5.4%, Av-Gad 5.3%, Azrieli 4.9%, and Hajaj Europe 4.4%.

Since the start of the quarter, the TA-35 index has dropped 2.1%, TA-125 by 1.3%, banking stocks by 5.7%, oil and gas by 14.1%, and security stocks by 19.2%. Conversely, the cleantech index rose 13.8% and the TA-90 gained 1.6%. The positive Wall Street chip rally is expected to boost Israeli chip stocks and support the Tel Aviv market's performance as the quarter closes.