Israeli stocks hit record highs after US airstrikes on Iran
What's the story
Israeli stocks have hit record highs following the US airstrikes on Iranian nuclear sites. The attacks are seen by investors as a major move to stop Tehran from developing nuclear weapons anytime soon. The broad Tel Aviv 125 index jumped 1.8%, extending gains to nearly 8% for the week, while the blue-chip TA-35 surged by 1.5%.
Market response
Tel Aviv 125 index gained nearly 8% last week
The Tel Aviv 125 index gained nearly 8% last week, after Israel targeted Iranian nuclear and military sites ahead of Saturday's surprise attacks by the US. Mizrahi Tefahot chief markets economist Ronen Menachem said, "The destruction of Iran's key nuclear facilities by the US military is a positive development ... in terms of improving the regional security environment and reducing Iran's military and nuclear capabilities."
Escalation
Israel began campaign against Iranian nuclear sites on June 13
Israel began its aggressive campaign against Iranian nuclear sites, missile production facilities, and military commanders on June 13. The strikes have drawn retaliatory fire from Iran, wounding scores of people and casuing destruction to several buildings in Tel Aviv over the weekend. US President Donald Trump announced that he had "obliterated" Iran's main nuclear sites in overnight strikes with bunker-busting bombs, joining an Israeli assault in a major escalation of conflict in the Middle East.
Investor sentiment
Despite ongoing conflict, local markets have remained optimistic
Despite the ongoing conflict with Iran, local markets have remained optimistic about Israel's actions. Along with share gains, government bond prices have risen and the shekel has appreciated. The TA-125 index rose 1% intraday to hit a high of 2,931. It tracks the performance of Israel's top 125 companies by market capitalization listed on the Tel Aviv Stock Exchange (TASE).