The Tel Aviv Stock Exchange (TASE) fell today. The Tel Aviv 25 Index fell 4.91% to 633.72 points, the Tel Aviv 100 Index fell 5.33% to 554.23 points, and the Tel-Tech fell 9.06% to 123.08 points. Turnover was NIS 1.54 billion.
A dismal day on the TASE took a dramatic turn at 4 pm with a wave of sales that had an aura of panic about it. There were no buyers until the Tel Aviv 25 Index fell 11%, which resulted in the TASE shutting down the market 15 minutes before the end of the session.
Speculation about the identity of the sellers ranged from a foreign institution that had decided to liquidate its position to manipulation by parties aimed at seeding panic in order to induce the government to intervene. The usual suspects were also mentioned: short sellers and Tel Aviv 25 options players. A fairly small amount of sell orders, about NIS 30 million, were enough to topple the market.
Meitav Group dealer Amir Karmi told "Globes", "Someone very big manipulated options on shares, and sold a basket worth NIS 30-40 million in a single transaction."
Trading resumed at 6 pm, and the leading indices reverted to their levels before the incident.
In the foreign currency market, the shekel-dollar exchange rate rose 0.73% to NIS 3.998/$, and the shekel-euro exchange rate edged up 0.03% to NIS 5.008/€. The shekel-dollar exchange rate rose to over NIS 4 in late inter-bank trading.
In the stock market, many shares lost a substantial part of their value, but it is impossible to ignore the collapse of Israel Chemicals Ltd. (TASE: ICL), which tumbled 13%, following a profit warning by its Russian competitor, JSC Uralkali (LSE; RTS:URKA).
Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY) is another share that could not be ignored today, after it published a profit warning, predicting a loss of NIS 1.7-2 million. The share fell 16%, when trading was suspended, but rose 24% when trading was resumed. Presumably, someone thought this was an opportunity, or at least worth a gamble. Eventually, the share price stabilized again to end the session down 1.2%.
Trading was volatile in other real estate shares as well, and the Real Estate 15 Index fell 6.4%.
The Tel-Tech Index was the biggest loser today, pulled down by a 50.5% drop by VeriFone Holdings Inc. (Nasdaq: PAY; TASE: PAY) in the wake of yesterday's profit warning for the fourth quarter.
Published by Globes [online], Israel business news - www.globes-online.com - on November 20, 2008
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