ISRAEL: Israel shares rebound following optimistic forecast on Sharon's health condition.

Record ID: 398507

  • Title: ISRAEL: Israel shares rebound following optimistic forecast on Sharon's health condition.
  • Date: 8th January 2006
  • Summary: (W3) RAMAT GAN, ISRAEL (JANUARY 8, 2006) (REUTERS) EXCHANGE ROOM IN FIRST INTERNATIONAL BANK OF ISRAEL; PEOPLE SEATED AT DESK IN FRONT OF COMPUTER SCREENS ; SCREEN SHOWING VARIOUS STOCK MARKET FIGURES (VARIOUS) MIKE KNOPF SENIOR OPTION TRADER OF THE FIRST INTERNATIONAL BANK OF ISRAEL, ON THE PHONE; CLOSE OF KNOPF TALKING ON THE TELEPHONE; CLOSE OF KNOPF' HANDS TYPING; C
  • Embargoed: 23rd January 2006 12:00
  • Keywords:
  • Location: Israel
  • Country: Israel
  • Topics: Economic News,Domestic Politics
  • Reuters ID: LVA2N82Z9PX077LS1MYZMB3XS31M
  • Story Text: Israeli shares rebounded on Sunday (January 8) upon word of improvement in Israeli Prime Minister Ariel Sharon's health, and growing confidence that the acting Prime Minister Ehud Olmert was taking control and would stick with the government's pro-market economic policies, traders said.
    Olmert, who is also Finance Minister, has said he plans to continue the government's tight fiscal policies that helped spur economic growth of around 5 percent in 2005.
    Sharon, who was on vying for a third straight term as prime minister in the March 28 election, was rushed to the hospital on Wednesday (January 4) night after a massive brain haemorrhage
    On Thursday (January 5) Tel Aviv's two major stock indexes fell around 4 percent after Sharon's stroke, heightening uncertainty in the run-up to elections scheduled for March. There was no trading on Friday.
    Senior Option Trader of the First International Bank of Israel, Mike Knopf said that on Sunday (January 8) the stock exchange market has been relatively calmly despite the unusual event.
    "Looks like volumes are rather high, compared to previous Sundays where volumes were pretty modest. The market is as I said rather volatile, going up and down according to reports coming from the medical staff in Jerusalem and we are just gonna have to take it step by step here and see what developments are during the week," Knopf said as the market opened.
    For the market, which had factored in an easy Sharon victory, Israel's political system is now in upheaval.
    Experts say that International investors are confident in the Israeli economy and that fiscal and monetary policies will continue as they were. They predict Olmert will not change economic policies in the coming months.
    However, the market would continue to follow Sharon's condition closely.
    " Over the weekend Sharon's medical team seemed to be more optimistic than they were on Thursday and Friday morning, so we might see some sort of developments on that issue," Knopf explained.
    Bank stocks led the rises on Sunday, with Bank Leumi, up 2.5 percent and Bank Hapoalim, up 1.5 percent.
    On Friday (January 6) the Israeli currency closed at 4.62 shekels to the greenback.
    Analysts forecast the shekel would rise against the dollar on Monday (January 9) for the same reasons that were lifting the stock market.
    Sharon's death or incapacitation would inevitably cause political upheaval in Israel and could set back hopes for peacemaking with the Palestinians raised by Israel's pullout from the Gaza Strip completed in September.
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