Bank Hapoalim paces TA-25 to new record

Stocks rose Tuesday, sending the benchmark index to a record, paced by Bank Hapoalim Ltd., Israel's largest lender.

SHARES TEL AVIV Stocks rose Tuesday, sending the benchmark index to a record, paced by Bank Hapoalim Ltd., Israel's largest lender. The TA-25 Index climbed 6.56, or 0.9 percent, to 932.28, as 18 stocks gained and eight declined. Investors bought and sold about NIS 1.58 billion in shares and convertibles, 11% more than the average daily volume in the first 10 months of 2006. Bank Hapoalim added NIS 0.68, or 3.4%, to NIS 20.79, its biggest one-day gain since September 13. A group of investors led by Shlomo Dovrat and Harel Beit-On bought a 75% stake in Lumenis Ltd., an Israeli maker of laser equipment used in cosmetic surgery. The group agreed to inject funds into the company as part of a deal that requires Bank Hapoalim to restructure $214 million of Lumenis debt. "With this transaction it seems that Hapoalim is going to get back at least $100m. from Lumenis debt," Yuval Ben-Zeev, an analyst at Clal Finance Batucha Investment Management Ltd., said by telephone from Tel Aviv. Africa Israel Investments Ltd. advanced NIS 5.30, or 1.8%, to NIS 297.10. The property development and holding company is seeking to win control of Oil Refineries Ltd., Globes reported, without saying where it got the information. A spokeswoman for the Yehud-based company said Africa Israel is considering the subject but hasn't made any decisions yet. Delek Group Ltd. rose NIS 8.10, or 1.1%, to NIS 752.40. Shares of the Netanya-based holding company, which has interests in energy and real estate, will probably trade at NIS 900 in the next 12 months, up from a previous estimate of NIS 875, UBS AG said. "The energy and financial services assets stand out as future drivers of growth," analyst Joseph Wolf said in a report. Separately, Delek won the approval of Republic Companies Group Inc.'s shareholders for its $285m. takeover of the Texan insurer. Elbit Systems Ltd., Israel's largest non-government defense firm, increased NIS 4.10, or 3%, to NIS 141.20. Koor Industries Ltd., a holding company with agrochemicals and telecommunications equipment assets, agreed to sell its remaining 1.9% stake in Elbit for NIS 112.4m. "This is a positive move for Elbit," said Dan Saar, an analyst at First International Bank of Israel Ltd. by telephone from Tel Aviv. "It values the company at a higher price than what it traded yesterday in the market." Koor sold the shares for NIS 138.75 each, more than Elbit's closing price Monday of NIS 137.10. Gadot Biochemical Industries Ltd. added NIS 1.13, or 4.6%, to NIS 25.96. The maker of citric acid and other food ingredients agreed to buy a North American peer to boost sales by almost 50%. Haifa-based Gadot will pay as much as $20m. for the business, which is likely to post revenue of $40m. this year. Israel Chemicals Ltd., which harvests minerals from the Dead Sea to make fertilizer, climbed NIS 0.41, or 1.6%, to NIS 26.51, taking its two-day gain to 5.2%. Albemarle Corp., a US maker of specialty chemicals, raised the prices of SAYTEX flame retardants by as much as 10% Monday. "This is a very monopolistic industry and we will probably see Israel Chemicals raising the price of their products in a week or 10 days," Gilard Sarig, an analyst at Bank Hapoalim, said Monday by telephone from Tel Aviv. WALL STREET US stocks rose for a second day after growth at service industries unexpectedly accelerated, suggesting the largest part of the economy is expanding fast enough for companies to meet profit forecasts. In afternoon trade, the Standard & Poor's 500 Index advanced 2.49, or 0.2%, to 1,411.61, while the Dow Jones Industrial Average increased 18.19, or 0.2%, to 12,302.04, and the Nasdaq Composite Index added 1.19, or 0.1%, to 2,449.58, aided by gains in Applied Materials Inc. and other chip-gear makers after an industry group forecast higher sales. The Institute for Supply Management's index of non-manufacturing businesses climbed to 58.9 last month from 57.1 in October. Readings above 50 indicate expansion. The index was expected to decline to 55.5, the median forecast in a Bloomberg survey of 70 economists. EUROPE European stocks also rose for a second day after growth in US service industries unexpectedly accelerated, boosting speculation the region's biggest trading partner can avoid an economic slump. "It is comforting to see that the services side of the economy is in good shape," said Jan Leroy, who helps manage the equivalent of $10b. at Petercam Asset Management in Brussels. "It was a relief" for markets." The Dow Jones Stoxx 600 Index rose 0.7% to 353.91 in London. The Stoxx 50 gained 0.6% and the Euro Stoxx 50, a measure for the 12 nations sharing the euro, added 1.1%. National benchmarks gained in all 18 western European markets, except in Greece and Switzerland. Germany's DAX rose 1.2%, the UK's FTSE 100 added 0.6% to 6,086.40 and France's CAC 40 added 1.2%. ASIA Asian power-producer stocks such as Tokyo Electric Power Co. and Tenaga Nasional Bhd. gained on speculation lower oil prices and a weakening dollar will reduce fuel costs. Shares of Japanese banks led a decline in the Topix Index on concern the nation's economic recovery may have stalled, delaying central bank plans to raise interest rates. The Topix slid 0.6% to 1,598.89 while the Nikkei 225 Stock Average lost 0.2% to 16,265.76. Benchmarks also fell in Sri Lanka, Taiwan and South Korea while rising elsewhere. Indonesia's measure climbed 2.6% to a record, making it the region's biggest gainer, after the central bank said it has room to cut interest rates this week. India's Sensitive index climbed to a third straight record. Thailand was shut for a holiday. The Morgan Stanley Capital International Asia-Pacific Index rose 0.4% to 137.02 at 8:57 p.m. in Tokyo, as a slide in the US currency increased the dollar value of regional stocks. CURRENCY The dollar rebounded from near a 20-month low against the euro after a report showed US services industries unexpectedly strengthened. The US currency also rose from a four-month low versus the yen. The dollar advanced to $1.3328 per euro midday in New York, from $1.3343 Monday, when it reached $1.3367, the weakest since March 2005. The dollar traded at 114.95 yen, after touching 114.44 yen earlier Tuesday, the lowest since August 7. COMMODITIES Crude oil rose on speculation the Organization of Petroleum Exporting Countries will agree to cut output next week, after a plunging dollar reduced the value of oil in euros, yen and pounds. OPEC, which sells oil in dollars, is scheduled to meet December 14 in Abuja, Nigeria. Crude oil for January delivery rose 58 cents, or 0.9%, to $63.02 a barrel in afternoon trade on the New York Mercantile Exchange. Gold fell in New York and London after a rebound in the dollar against the euro eroded the appeal of precious metals as an investment alternative. Gold futures for February delivery fell $2.60, or 0.4%, to $648.30 midday on the Comex division of the NYMEX.