preface

BDO Israel
TA 25 Index (Maof)
Source: Tel Aviv Stock Exchange, January 2011.
DOING BUSINESS IN ISRAEL
Similar to 2009, the Israeli and world capital markets were characterized
by strong uncertainty in 2010, as markets were still recovering from the
2008 financial crisis. Share prices peaked during 2009, resulting in a
highly volatile trading market in 2010. TASE closed 2010 with a 17%
increase of its main share price index.
Share prices during the first half of 2010 declined in Israel and the rest
of the world but rebounded in the second half of 2010. By year end, the
TA-25 gained approximately 17%, marking a 140% increase from its
low point in November 2008. Towards the end of the year, the TA-25
returned to its record level attained in October 2007.
According to the Bank of Israel, foreign investors cleared approximately
US $1.9 billion of public equity investments between February and May
2010. This took place before the Israeli market was upgraded by the
MSCI to “developed market". During the summer of 2010, renewed
investments led to a net purchase of US $0.7 billion between July and
October, 2010.
Gas and oil exploration securities had a major impact on TASE in 2010.
These were responsible for approximately a quarter of the growth in
returns on the leading share price indices and for more than 40% of the
increase in trading volume on the equity market.
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