Tel Aviv Stock Exchange Shows Signs of Recovery After Eight Months of Decline
Translated & summarized from Maariv by baba
The Tel Aviv Stock Exchange may be nearing the end of an eight-month decline, with analyst Or Pourya seeing current prices as an attractive entry point. Despite investor nervousness, market valuations are considered reasonable. Pourya expects the Israeli shekel to strengthen long-term, but anticipates the Bank of Israel may slow interest rate cuts due to global trends and domestic inflation.
The story in 6 lines · by baba
- Tel Aviv Stock Exchange may be nearing end of 8-month decline, analyst Or Pourya suggests.
- Market valuations are reasonable, with no justification for panic, according to Pourya.
- Current prices offer an attractive entry point for the Israeli stock market.
- Increased likelihood of a "change government" could boost investor sentiment short-term.
- Israeli shekel expected to strengthen long-term, but interest rate cuts may slow.
- Bank of Israel might pause rate cuts due to global hikes and Israeli inflation.
Following eight months of significant drops, the Tel Aviv Stock Exchange (TASE) may be nearing the end of its correction period, according to analyst Or Pourya. After a turbulent week, gains on Wall Street are providing a positive impetus for the Israeli market. Pourya suggests that major investments in artificial intelligence, the political direction in the US midterm elections, and tensions with Iran were already factored into investor sentiment.
Pourya believes that the primary change has been an increase in investor nervousness rather than a fundamental shift in market conditions. He asserts that current market valuations remain reasonable relative to underlying data, and there is no justification for panic at this time. "In our assessment, the pricing levels in the markets remain reasonable relative to the fundamental data, and there is no justification for panic at this stage," Pourya stated.
Regarding the local stock market, Pourya is optimistic. He notes that after an accumulated decline of approximately 18% over the past eight months, the Israeli stock market appears to be close to completing its correction. Current price levels could represent an attractive entry point, and an increased probability of a "change government" formation might support investor sentiment and market performance in the short term.
Pourya also anticipates a long-term strengthening of the Israeli shekel, though he cautions that interest rate cuts in Israel might proceed more slowly than expected. "In our assessment, the long-term strengthening trend of the local currency remains intact, and recent developments do not change our central working assumption on this matter," he explained. He added that due to expectations of global interest rate hikes and rising inflation expectations in Israel, the Bank of Israel might slow down its pace of interest rate reductions or even pause them for a period.
