• Israeli stocks, as defined by the BlueStar® Israel Global Index (BIGI®), rose 7.32% in the first quarter of 2023, underperforming US equities yet outperforming international markets.
  • Israeli technology stocks, as defined by the BlueStar® Israel Global Technology Index (BIGITech®), gained 4.8% in Q1, underperforming US and Global tech peers by 8.6% and 8%, respectively.
  • In general, Israeli stocks have recovered considerably from lows since following the October 7th attacks, signifying investor’s confidence that the IDF has the situation under control. The stability and resilience of the Israeli equity market has once again been demonstrated.
  • Moody's downgraded Israel's credit rating and outlook, citing deteriorating public finances and a potentially higher debt burden due to the war. However, Fitch removed Israel from Rating Watch Negative (RWN), assigning the Long-Term Foreign Currency Default Rating (IDR) a rating of ‘A+’ with a Negative Outlook.
  • The Monetary Committee left interest rates unchanged at 4.5% in meetings held in February and April of 2024, choosing not to implement rate cuts, citing worries that inflation could pick up once more amid the ongoing conflict with Hamas.
  • Additional funding in the billions of shekels is required to support military operations, provide compensation for reservists, assist the many individuals displaced near the border, and aid those impacted by the attacks on October 7 by Hamas operatives.
  • The contentious judicial reform bill has been put to the sideline by Israel's Supreme Court, alleviating, for the time being, a significant concern for the Israeli markets.  Israel’s myriad of strategic and political challenges as we publish this report are the continued need to destroy Hamas’ military capabilities, deep desire to return the remaining hostages, and growing threats from Iranian proxies in Lebanon, Iraq, Syria and Yemen.  Furthermore, PM Netanyahu faces strengthened opposition at home, and pressure from US President Biden's call for an "immediate ceasefire” before the IDF’s military objectives have been achieved.

View pdf >