August 30, 2012–Israeli stocks traded in New York fell, sending the benchmark index on track to its first monthly retreat since May, as the global slowdown propelled Nice Systems Ltd. (NICE) and Ceragon Networks Ltd. (CRNT) to cut their outlooks.
The Bloomberg Israel-US Equity Index (ISRA25BN) of the most traded Israeli companies in the U.S. slumped 0.8 percent to 83.35 yesterday, extending its decline this month to 1.6 percent. Nice Systems, a maker of analytical telecommunications software, is posting the biggest monthly decline in two years after cutting its profit and revenue forecasts. Ceragon, a maker of wireless networks, slumped 16 percent in August, the most in nine months.
Israeli companies are getting hit by a faltering economic recovery in the U.S. and the sovereign debt crisis in Europe. About 40 percent of the nation’s gross domestic product comes from exports, with Europe and the U.S. accounting for more than half of the trade. Nice sent more than 60 percent of its products to the U.S., while Ceragon received about 25 percent of its revenue from customers in Europe and the U.S.
“A lot of these technology companies had lowered their outlook and that has obviously impacted investor sentiment,” Daniel Meron, an analyst at RBC Capital Markets, said by phone yesterday from Tel Aviv. “It has more to do with the economic environment. Although some of these companies have their own dynamics, it all starts and ends with the economy.”
Israel’s TA-25 Index (TA-25), which was little changed at 1,120.58 yesterday, climbed 1.3 percent in August, a second month of gains. The measure has gained 3.2 percent this year, outperforming the Bloomberg Israel-US Index’s 2.6 percent gain…Read More>>