Tel Aviv Stock Exchange sees worst day in years
Global instability makes itself felt as bourse closes with sharp drops across all indices; senior economist warns of many 'causes for concern.'
"There are a lot of reasons for concern," said Amir Kahanovich, the chief economist at The Phoenix Insurance Company & Excellence Nessuah Investment House.
At the end of the day, the stock market closed with sharp declines across the board: The Tel Aviv 35 fell by 5.1%, the sharpest decline since August 7, 2011; all shares on the TA-125 Index were traded down in a negative direction, while the index itself fell 4.7%; and the Bank Shares Index also fell by 4.1%.
Among the stocks that fell sharply were the Perrigo global healthcare supplier, which dropped 29%; Israel's Teva Pharmecutical Industries, which was down 8%; the Delek Group, whose shares were down 5.7%; and various IT stocks such as Hilan and Matrix, which fell 5.8% -5.9%.
Perrigo, Kahanovich said, saw its shares suffer not only from the general decline in the stock market, but also from the news of a massive tax bill for its subsidiary in Ireland. Perrigo is one of the largest shares on the Tel Aviv Stock Exchange, and its drop contributed to the overall decline in the indices.
So what exactly is happening? "We are in a sharp decline, continuing the trend that began in most of the world markets in October," said Kahanovich. "Many of the markets are already down by more than 20%, and the Tel Aviv Stock Exchange is reacting accordingly."
Kahanovich was circumspect about branding the downturn a crash.
"Long-term investors should not be that alarmed, but as far as recent investors are concerned, this is indeed a crash. From a long-term perspective, the market is very high compared to recent years," he said.
