Israeli stocks fell for the first time in eight days after a US report showed durable goods orders trailed forecasts. Israel Discount Bank Ltd. led declines, falling the most in almost a decade.
The TA-25 Index dropped 6.54, or 0.7 percent, to 982.27, after gaining in earlier trading. Nineteen shares declined and six climbed. Investors bought and sold about NIS 1.83 billion in shares and convertibles. The measure is on course for a third straight quarterly gain, having climbed 6% since the start of the year.
"The US economy data led shares down," Joel Kirsch, a trader at Leader & Co. Ltd., said by telephone from Tel Aviv. "Today it was global trends more than anything else."
Discount, which reported earnings today, plunged NIS 0.85, or 8.6%, to NIS 9.10, the biggest one-day drop since October 1997. The shares were downgraded to "market perform" from "market outperform" at Clal Finance Batucha Investment Management Ltd.
"Strategic plan targets are not ambitious," Clal analysts wrote in a report. A return-on-equity target of 13% for 2010 "is too little, too late."
The bank, Israel's third-largest, returned to profit in the fourth quarter, posting net income of NIS 148 million on increased lending income and as it set aside less money for bad debts.
Makhteshim Agan Industries Ltd. increased NIS 0.30, or 1.2%, to NIS 25.27. Psagot Ofek Investment House Ltd. raised its recommendation on the world's biggest maker of generic agrochemicals to "market outperform" from "market perform" and increased its price estimate to NIS 28.5 from NIS 24.
"The positive trend in the global agriculture industry is expected to positively affect the outcomes of Makhteshim Agan in the next two years," Limor Gruber wrote in a report.
US stocks fell after Federal Reserve Chairman Ben Bernanke reiterated concerns about inflation, disappointing investors hoping that weaker growth would soon push the Fed closer to cutting interest rates.
The Dow Jones Industrial Average fell 94 points, or 0.7%, to 12,303 in afternoon trade, recovering from a fall of more than 140 points shortly after Bernanke's speech. The S&P 500 fell 10.1 points to 1,418, while the Nasdaq Composite dropped 15.9 points to 2,421.
"Overall, the economy appears likely to continue to expand at a moderate pace over coming quarters," he told a congressional pattern, adding that he doesn't see a recession coming this year. At the same time, he said, the core rate of inflation "remains uncomfortably high" but "seems likely to moderate gradually over time."
European stocks dropped for a third day after oil rose to the highest in six months and the weaker-than-expected US report on durable goods. The Dow Jones Stoxx 600 Index lost 0.6% to 370.10, the Stoxx 50 fell 0.7% and the Euro Stoxx 50, a measure for the 13 nations sharing the euro, dropped 0.6%. National benchmarks dropped in all 18 markets in western Europe, except for Norway. France's CAC 40 sank 0.6%, as did Germany's DAX. The UK's FTSE 100 shed 0.4% to 6,267.20.
Asian stocks dropped for a second day. The Morgan Stanley Capital International Asia-Pacific Index lost 0.5% to 144.55 as of 7:52 p.m. in Tokyo, following a 0.6% drop Tuesday. In Japan, the Nikkei 225 Stock Average fell 0.6% to 17,254.73, erasing gains of as much as 0.5%, while the broader Topix index slid 0.7%. All other markets fell, apart from in China.
The yen rose the most in two weeks against the dollar and euro. The yen rose 0.85% to 116.81 against the dollar and 0.96% to 155.78 vs the euro in New York, in its biggest jumps since March 13. The dollar rose 0.11% to $1.3336 per euro.
Crude oil rose for a seventh day on concern that tensions with Iran will escalate, disrupting shipments from the Middle East. Crude oil for May delivery closed up $1.15, or 1.8%, at $64.08 a barrel on the New York Mercantile Exchange.
Gold for April delivery closed up $4.30 an ounce on the Comex division of the NYMEX.