September summary on the local stock exchange: price declines in all leading indices


Trading on the Tel Aviv Stock Exchange in September was characterized by price declines in all the leading stock indices, similar to the trend in the world’s leading stock exchanges, according to data compiled by Nurit Dror of the Tel Aviv Stock Exchange’s research unit.

The TA-35 index, which represents the major stocks on the stock exchange, and the TA-90 index, which represents the medium-sized shares, fell by about 8%, while the TAA growth index, which represents the small stocks, recorded a more moderate decline of about 4%. Of about 3% -6% was recorded this month in the leading stock indices on the US stock exchanges and an average decrease of about 2% was recorded in the leading stock exchanges in Europe.

This month’s trading took place against the backdrop of the Tishrei holidays and was influenced by a number of factors, most notably the increase in the second wave of the Corona virus, and the economy entering another closure starting on September 18 for at least three weeks. Following this, the Israeli government announced a plan to compensate employers and employees for the damages of the closure, and especially to prevent dismissals and expenses for the Knesset.

This month, according to CBS data, the rate of employed persons temporarily absent from work due to the Corona + the unemployed reached 9.8% in August 2020. Back in September – the Fed announced the US interest rate hike at zero to the end of 2023 and signed a historic peace agreement between Israel to the United Arab Emirates, and signing a peace declaration with Bahrain.

Price declines also characterized all industry indices, including the Tel Aviv 5 Banks Index, which fell by about 13%, and the Tel Aviv Real Estate and Tel Aviv Oil and Gas Indices, which fell by about 10% each. The Tel Aviv-Illit and Tel Aviv-Technology indices, which rose by more than 30% in January-August and reached an all-time high, also fell by about 8% this month. A relatively moderate decline of about 3% characterized the TA-Family and TA-Industry indices.

The daily turnover in the stock market, including mutual funds, amounted to NIS 1.8 billion in September, 13% higher than in the previous month. At the end of January-September 2020, shares traded at NIS 1.9 billion a day – 48% higher than the average turnover in 2019. On September 3, on the eve of the monthly update of the stock indices, the turnover on the stock exchange amounted to NIS 4.0 billion. About NIS 1.8 billion in the closing phase.

Raisings in the Tel Aviv stock market are expected to total about NIS 2.2 billion this month. Of this, about NIS 2.1 billion was raised in seven public offerings and two rights issues. NIS 0.9 billion raised this month by three new companies, Max Stock – a chain of stores for home products at discounted prices – the controlling shareholders sold shares worth NIS 540 million, in a sale offer, and Israel Shipyards, a company engaged in vessel production, port services and logistics , Which raised about NIS 338 million.

The new third issuer is Unicorn Technology, which invests in technology companies, which raised NIS 60 million in a non-uniform offer to institutional investors (Book Building), in a uniform offer to the public and an additional NIS 10 million was raised from the general partner.

Among the older issuers this month, the public offerings made by El-Al and the alternative energy company Energix stood out at NIS 500 million each. For Energix, this is the third issue this year, with the company raising NIS 472 million in the previous two issues. Additional – making Energix the leading recruiter this year, raising NIS 1 billion in share issues.

The derivatives market this month was characterized by higher trading volumes than those recorded in the previous month, due to the effect of volatility in the stock market as reflected in the VTA35 index. The index rose from about 21 points at the end of August to about 29 points on September 9, and fell while fluctuating to a level of 22 points towards the end of September.

The daily trading volume of options on the Tel Aviv-35 Index (monthly and weekly) amounted to approximately 130,000 units in September, compared with approximately 85,000 units in the previous month, compared with approximately 98,000 units in September 2019. The increase applies to both monthly and weekly options. In the months of January-September 2020, 113,000 options were traded on the Tel Aviv-35 index (monthly and weekly) – 16% higher than the average turnover in 2019.

The market value of the 528 mutual funds traded on the stock exchange at the end of September 2020 was NIS 3.3 billion lower than the value at the end of the previous month and amounted to NIS 80 billion. This month, 19 mutual funds were delisted – 18 mutual funds were liquidated (11 mutual funds on stock indices abroad, 4 mutual funds on bond indices abroad, and 3 mutual funds on bond indices in Tel Aviv), and a mutual fund On an index-linked government bond index it has become open. The total value of all the liquidated funds reached NIS 55 million.

Most of the decrease in the value of public holdings, about NIS 2.2 billion decrease in the value of mutual funds on stock indices abroad – NIS 1.8 billion comes from the decrease in share prices abroad and NIS 0.4 billion comes from public sales, and about NIS 2.1 billion decreases in the value of mutual funds On Tel Aviv stock indices – which was entirely due to the declines in Tel Aviv stock prices.

In the mutual fund market, there was a trend opposite to that of mutual funds, with the public selling mutual funds investing in Tel Aviv shares in the amount of NIS 0.3 billion net, and purchasing mutual funds investing abroad in the amount of NIS 0.4 billion net.

It should be noted that the mutual funds that invest in bonds in Tel Aviv recorded balanced activity in September, after public sales of about NIS 20.5 billion in January-August 2020.

• All data are estimates, as of the beginning of Tuesday, September 29, 2020.

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