Wall Street: 32 of 40 the biggest Israeli stocks advanced in January
02.2.06 | 11:51
After an iffy year in 2005, Wall Street started the year 2006 with a bang. Nasdaq touched a five-year high of 2,330 points and the Dow Jones crossed the 11,000-point mark. Then a few tech giants delivered disappointing results for the year that was, which dampened the trend somewhat. But summing up January, the Nasdaq tech market rose 4.6% to 2,306 previous year, and the Dow Jones advanced 1.4% to 10,865.
The S&P-500 index, of the 500 biggest mammoths on the Street from all sectors, jumped 2.5% in January to 1,281 points.
Israeli stocks outperformed the benchmark indexes, and by a lot. The Meitav New York-40 index, tracking the forty Israeli companies with the highest market cap in New York, shot up 8.5% in January 2006. Most of the stocks on the index, 32 out of 40, advanced.
In January the year before, Meitav New York-40 sank 1.8% - but again it did better than its American peers. The Nasdaq lost 5.2% in that month.
The sharpest gainer on Nasdaq in January 2006 was Magal Security Systems (Nasdaq: MAGS), which soared 30.6%, after sinking 28% in 2005. The Israeli security systems company can thank Osama bin Laden for its January jump: the arch-terrorist released another tape threatening the U.S. Magal has a history of leaping like an ibex every time a terror alert rolls in. The day terrorists struck at London's underground, Magal surged 13%.
Magal. When security systems are in, they're in
Mercury Interactive </a> (Nasdaq: MERQ) also stood out in January with a 25% leap. The company had slumped badly in the last months of 2005 after Wall Street and the world learned of the grave irregularities in its stock options habits. Namely, top officers had knowingly backdated the date of option grants in order to maximize gain. Three people, including CEO Amnon Landan, were forced to step down, but the market generally concurred that there was nothing wrong with the business optimization software provider's core business.
In the last three months of 2005, Mercury lost 30% of its value. In January 2005, as said, it climbed 25%.
By the way, yes, Mercury was tossed off the Nasdaq main list after failing to file amended financials for the second and third quarters of 2005 in time. But its fourth-quarter financials showed the scandal had not hurt sales; and in January Mercury used some of its cash to buy a Czech company for $105 million. By month-end Mercury's market cap was back at $3 billion.
Orckit Communications (Nasdaq: ORCT) also did beautifully, climbing 24% to a market cap of $400 million in January. In 2005, Orckit generated 190% returns for investors thanks to strong results and hopeful forecasts for 2006.
Actually, one of the worst performers in January has been M-Systems (Nasdaq: FLSH), which starred in 2005 with a 68% jump in market cap. In January it retreated by 12.5%, after the company reported strong sales for the year, but eroding margins in the last quarter. Also, M-Systems, which pioneered flash memory technology, didn't provide guidance for the year 2006.
haaretz.com
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