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Israel's stock market slid Wednesday as investors reacted to partial election results that left Prime Minister Benjamin Netanyahu's bloc short of the seats needed to form a government, while the shekel weakened against the dollar.
The TA-90 index plunged 4.62% to 3,635.69, while the benchmark TA-35 fell 2.33% to 4,108.17, according to the latest figures from the Tel Aviv Stock Exchange as of 12 p.m. GMT. The broader TA-125 index dropped 2.86% to 3,990.38, and the TA-200 lost 4.05%.
The sell-off marked a sharp reversal from Monday, when Israeli stocks gained nearly 2% ahead of the election.
Financial and real estate stocks led Wednesday's losses. The TA-90 Banks index fell 4.53%, while the TA-SME60 index, which tracks smaller companies, dropped 3.52%. The TA Sector-Balance index also declined 3.68%.
The TA-90 recorded 87 falling stocks against just three gainers, while the TA-125 had 115 decliners and 11 gainers. On the TA-200, 181 stocks fell and just 16 advanced.
The shekel weakened as investors assessed the election results and prospects for a stable governing coalition, with the dollar climbing 2.15% to 3.1197 shekels.
Israeli government bonds also traded lower across several maturities. The bond maturing in July 2028 fell 0.08%, while the bond maturing in 2035 declined 0.59%. Bonds maturing in April 2032 and March 2035 lost 0.4% and 0.58%, respectively.
With 84.5% of votes counted, Netanyahu’s bloc was on track to win 54 seats in the 120-member Knesset, seven short of the 61 needed for a parliamentary majority.
The opposition bloc led by Gadi Eisenkot was set to take 49 seats, while predominantly Arab parties were expected to win 17, according to the Central Elections Committee.
Among individual parties, Netanyahu’s Likud led with 27 seats, followed by Eisenkot’s Yashar with 22. The Together alliance was on track to win 12 seats, while the predominantly Arab Joint List was set to take 11 and the United Arab List (Ra’am) six.
The Democrats was expected to secure eight seats, while Yisrael Beiteinu, Shas, United Torah Judaism and Otzma Yehudit were each on track to win seven. Religious Zionism was expected to take six seats.
The results remain provisional as vote counting continues.
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