Israel's key stock index declined the most in a month as some investors said they were concerned about a possible US attack on Iran. Nice Systems Ltd. paced the drop.
The TA-25 Stock Index lost 0.7 percent to close at 966.29 in Tel Aviv, the biggest one-day decline since January 10. Eighteen stocks fell and seven gained. Investors bought and sold about NIS 1.78 billion in shares and convertibles.
Some advisers to US President George W. Bush are secretly seeking an excuse to attack Iran, Hillary Mann, a former National Security Council director for Iran and Persian Gulf affairs, told Newsweek magazine in a report published Sunday.
The advisers "intend to be as provocative as possible and make the Iranians do something" that the US "would be forced to retaliate for," Mann told Newsweek.
Investors are worried about "the critical mass of political uncertainty in the region," Avi Weinreb, a trader at Clal Finance Batucha Investment Management, said.
Nice, a maker of digital-recording products, lost 1.8% to NIS 135.60. Verint Systems Inc., whose software helps companies analyze their performance, agreed to buy Witness Systems Inc. for about $950 million to add more programs aimed at call centers. Israeli newspapers previously reported that Nice was looking to acquire Witness.
Delek Group Ltd. declined 1.2% to NIS 762.70. The holding company with interests in energy, real estate and insurance declined after crude oil prices fell on speculation supplies are sufficient to meet increased heating demand caused by a cold snap in the US.
Given Imaging Ltd. added 1.2% to NIS 87.01. The company, whose camera in a capsule diagnoses digestive problems, said UnitedHealth Group Inc., the largest US health insurer, will expand coverage to include the evaluation of Celiac disease.
IDB Holdings Corp., a holding company whose assets range from Israel's largest cellular operator to real estate, advanced 1.1% to NIS 122.30 gaining for an eighth day.
There is speculation of a possible merger of IDB Development Ltd. and IDB Holdings, and possible acquisitions of IDB shares by Russian billionaire Arkady Gaydamak, Clal Fianance said in a note to investors. "We saw nothing to confirm any of these rumors today," it added.
US stocks fell for a third day, pulled lower by energy companies as oil prices declined.
The S&P 500 dropped 0.2% to 1435.84 in late morning trade in New York. The Nasdaq Composite Index slipped 0.3% to 2452.85.
A rally in Home Depot Inc. shares limited the drop in the Dow Jones Industrial Average after the largest home-improvement retailer said it may sell or spin off its building-supply division. The Dow Jones Industrial Average fell 0.1% to 12,572.90.
European stocks dropped as concern that borrowing costs will rise in the US pushed construction- related shares down from a record and a slide in oil prices sent energy companies lower.
The Stoxx 600 slid 0.6% to 378.06 at the close in London. The Stoxx 50 fell 0.5% and the Euro Stoxx 50, a measure for the 13 nations sharing the euro, lost 0.8%.
National benchmarks fell in all 18 western European markets, except Iceland. Germany's DAX dropped 0.8%, France's CAC 40 slid 0.9% and the UK's FTSE 100 declined 0.5% to 6,353.50.
Asian stocks snapped seven days of gains, led by a slide in technology companies.
The Morgan Stanley Capital International Asia-Pacific ex- Japan Index dropped from a record high, losing 0.9% to 404.37 as of late trade in Hong Kong. Technology stocks fell 1.7%, the most among the index's 10 industry groups.
All markets open for trading fell, except for those in China and Thailand. Japan was closed Monday for a holiday.
The yen traded little changed against the dollar and rose against the euro Monday.
In New York trading, the euro stood at $1.2963, compared with $1.3004 late Friday. The dollar was quoted at 121.74 yen, compared with 121.66 yen.
The British pound traded at $1.9474, compared with $1.9504. The euro fetched 157.85 yen, compared with 158.22 yen.
Crude oil fell after Saudi Arabia told Asian refiners to expect more shipments next month and the nation's oil minister said OPEC has no need to further rein in production.
Crude oil for March delivery fell 3% to $58.12 a barrel at early afternoon trade Monday on the New York Mercantile Exchange. Natural gas for March delivery tumbled 6.2% to $7.341 per million British thermal units on forecasts for milder weather in the eastern US next week after snowstorms in the next few days.
Gold prices in New York fell from a six-month high after the dollar strengthened, reducing the precious metal's appeal as an alternative investment.
Gold futures for April delivery fell 1%, to $665.80 an ounce just before midday on the Comex division of the New York Mercantile Exchange. (News Agencies)