Israeli shares continued their New Year surge on Tuesday, with one key broad index touching a record, the real-estate index advancing sharply for a second day, and Bank Hapoalim benefiting from an upgrade at Deutsche Bank.
The benchmark TA-25 index rose 0.7 percent to 947.68, just under its record close of 948.83, set December 20. The TA-100 advanced 1.14% to a record 950.69.
The Tel-Tech index of 15 top tech stocks tacked on 1.13% to 373.58; it topped out at 482.78 on January 20, 2004.
The most-active issue was Bank Hapoalim, trading up 0.3% at NIS 20.30 after the upgrade to buy from hold.
Analyst Michael Klahr made a valuation call - while he sees slowing earnings in the banking sector, Hapoalim's weakened share price "means that the total forecast return to our unchanged NIS 22 price target is now 16%" - including a 6.7% dividend yield - "which puts the stock in buy territory."
The TA-15 Real Estate index leaped 2.11% to 695.64 on top of Monday's 4% plus performance.
The prime property movers were GTC, up 5.1% at NIS 49.55, Delek Real Estate, up 4.2% at NIS 35.48, Alony Hetz, up 4.3% at NIS 21.45, Africa Properties, up 4.2% at NIS 193, and Industrial Buildings, up 4.1% at NIS 10.52.
"The weak U.S. dollar paves the way for further interest-rate cuts and keeps housing affordable in shekel terms, since prices are still denominated in U.S. dollars," says Avi Weinreb, trader at Clal Finance Batucha.
"In a broader perspective, real estate has only recently emerged from a slump since the late 1990s and traditionally outperforms after periods of conflict."
"Plus," Weinreb said, "there's a lot of liquidity out there looking for a home: a net NIS 8 billion of redemptions from the bond market in recent days."
US markets were closed Tuesday in observance of a day of mourning for former President Gerald Ford.
European shares rose to a six-year high on Tuesday, the first trading day of 2007, as investors continued to back stocks on the Continent on hopes for more mergers and rising valuations.
The French CAC-40 index rose 1.4% at 5,617.71, the U.K. FTSE 100 index rose 1.5% at 6,310.90 and the German DAX Xetra 30 index increased 1.3% at 6,681.13.
Asian stocks rose the most in almost two weeks, led by exporters Samsung Electronics Co. and Hon Hai Precision Industry Co. after Wal-Mart Stores Inc. reported higher sales and US consumers spent more online.
The Morgan Stanley Capital International Asia-Pacific excluding Japan Index rose on the first trading day of the year, gaining 1.3% to a record 402.33 at afternoon trade in Hong Kong.
Japan was one of seven markets closed for holidays.
The dollar declined to its weakest in three weeks against the euro on speculation the Federal Reserve will reduce interest rates this year while European Central Bank policy makers increase their benchmark.
The US currency fell to $1.3282 versus the euro in late morning trade Tuesday in New York, from $1.3201 Monday. The US currency fell to 118.79 yen from 119.05.
The euro rose for the fourth straight day to a high against the yen, trading at 157.74 yen from 157.15 Monday, after touching 157.87 yen.
Crude-oil futures started the new year on slightly lower ground Tuesday, while natural-gas prices dropped as much as 3%.
Crude oil for February delivery was last down 22 cents at $60.83 a barrel in trading on the CME Globex electronic platform, after reaching a high of $61.55. Trading on the New York Mercantile Exchange was closed to observe a day of mourning for former President Gerald Ford.
Gold futures extended their winning streak in electronic trading Tuesday, with a weaker US dollar helping the precious metal start the new year on firm footing.
Gold for February delivery was last up $4.70, or 0.7%, at $642.70 an ounce in electronic trading on CME Globex.
Trading on the New York Mercantile Exchange was closed to observe a day of mourning for former president Gerald Ford.