The Tel Aviv Stock Exchange closed Monday, December 29, with a cautiously constructive tone as major equity indices posted modest gains. The session reflected steady risk appetite supported by banking and value sectors, even as investors remained selective amid global volatility and year-end positioning dynamics.

Equities Edge Higher as Banks and Value Stocks Lead

Israel’s flagship TA-35 Index ended the session up 0.23% at 3,627.18 points, supported by balanced participation across large-cap constituents. Market breadth within the index was mixed, with 16 stocks advancing and 17 declining, signaling consolidation rather than aggressive risk-taking.

The TA-90 Index added a modest 0.04% to 3,779.30 points, reflecting muted momentum among mid-cap names. However, strength became more pronounced in the combined TA-90 and Banks Index, which rose 0.59%, underscoring continued investor confidence in the domestic banking sector. Financial stocks appear to be benefiting from stable margins, disciplined capital management, and their role as defensive anchors within local portfolios.

Broader market performance remained constructive, with the TA-125 Index closing 0.18% higher at 3,653.65 points. Notably, the TA-125 Value Index outperformed, gaining 0.80%, reinforcing a rotation toward value-oriented names as investors reassess growth valuations into the new year.

Sector Indices and Market Breadth Signal Selectivity

Sector performance highlighted selective positioning rather than broad-based buying. The TA Sector-Balance Index rose 0.07%, reflecting evenly split advances and declines across sectors. This balance suggests that investors are maintaining exposure while avoiding concentrated bets, a typical pattern during late-year trading.

Total equity market turnover reached approximately ₪4.08 billion, indicating sustained participation despite the absence of strong directional catalysts. Elevated volumes suggest portfolio adjustments ahead of year-end reporting and strategic repositioning rather than speculative activity.

Bond Market Mixed as Investors Weigh Duration Risk

Fixed-income markets delivered a mixed performance. The Short-Term Bond Index (up to one year) slipped 0.02%, reflecting mild sensitivity to near-term rate expectations. In contrast, the broader All-Bond General Index edged 0.07% higher, supported by selective demand for yield across the curve.

Linked bond indices showed divergence. The Tel Bond Linked A Index declined 0.19%, while the Tel Bond 60 Linked Index advanced 0.07%. This dispersion highlights cautious duration management as investors balance inflation-linked exposure against interest-rate uncertainty. Bond market turnover totaled roughly ₪3.50 billion, underscoring continued engagement from institutional investors.

Looking ahead, market participants will monitor whether banking and value stocks can continue to provide stability as global markets navigate heightened volatility and shifting macro expectations. Key risks include renewed pressure from overseas markets, changes in interest-rate outlooks, and geopolitical developments that could impact sentiment. At the same time, elevated liquidity and resilient domestic sectors may offer selective opportunities as investors position for the opening months of the new year. The ability of the Tel Aviv market to maintain orderly trading and balanced participation will remain a central indicator of underlying confidence.