Tel Aviv Stock Exchange Opens Mixed Amid Global Tensions and Strong Corporate Earnings

The Tel Aviv Stock Exchange (TASE) opened with mixed trends influenced by global developments including stalled Iran-US negotiations, an Israeli strike in Syria, declines in Asian chip stocks, and rising oil prices. Contracts on Wall Street remained stable ahead of the Federal Reserve's meeting minutes release. Notably, chip stocks like Camtek and Tower Semiconductor dropped by around 3% and 2%, respectively, while Elbit Systems rose 2.5%. Key quarterly reports from companies such as Clal Insurance, Castro, Asht, Beit Shemesh Engines, and Azrieli Group are expected today, with ZIM Integrated Shipping reporting on Wall Street.

Yesterday, TASE indices showed gains with TA-90 up 1.5% and TA-35 slightly higher. The software index surged 4.3%, driven by Matrix's strong earnings report which boosted other software stocks like One Technologies, Formula Systems, and Hailan. The banking index rose 1.9%, oil and gas by 1.6%, and real estate indices by up to 1.5%. Conversely, technology, security, and industrial sectors declined. Retail and real estate stocks also stood out, with Urbanika reporting record profits and BIG Real Estate posting a 60% profit increase.

Asian markets opened sharply lower, led by South Korea's Kospi falling 5.9%, with Samsung and SK Hynix dropping over 7%. Japan and other regional markets also declined. Meanwhile, Unitree Robotics soared 600% on its Shanghai debut. The US delayed a 50% tariff on Canada by three days to continue negotiations. Wall Street futures were stable, with focus on the Fed minutes that may clarify interest rate directions.

In bond markets, Israel's 10-year CDS risk premium improved from 104 basis points in late July to about 87 this week, signaling easing tensions after the October 2023 conflict peak. However, US 10-year Treasury yields hit their highest since early 2025 at 4.75%, driven by inflation concerns and heavy corporate debt issuance. European long-term yields also rose to decade highs. Analysts attribute rising yields to high oil prices, increased government debt issuance, and risk premiums rather than expectations of further rate hikes.

On commodities and currencies, the shekel strengthened slightly against the dollar, trading near 2.989. Oil prices rose for the fourth consecutive day amid Iran tensions, while gold stabilized around $4,340 per ounce after a sharp drop due to rising bond yields.

Macro data from the US suggests inflation is moderating, reducing the likelihood of imminent Fed rate hikes, according to Psagot economists. In Israel, despite low inflation, further rate cuts are unlikely soon due to geopolitical and budgetary uncertainties, strong wage growth, and robust economic data.

Goldman Sachs forecasts the space industry could grow into a $1.8 trillion economy by 2035, driven by lower launch costs, private investments, and public market financing. The "Orbital Economy" is shifting from government-led to institutional asset class status. However, analyst opinions on individual space companies vary widely, reflecting market volatility. Major players like SpaceX dominate, while smaller firms face pressure to merge or partner. Investors are advised to exercise patience amid this emerging sector's long-term potential and short-term fluctuations.