The Tel Aviv Stock Exchange opened with a mixed picture on the morning session of December 29, 2025. While the benchmark TA-35 posted a slight increase of 0.07% to 3,621.44 points, other indices such as the TA-90 recorded a small decline of 0.18%, reflecting uneven investor sentiment. The morning trading environment highlights cautious optimism as participants navigate end-of-year positioning, sector rotations, and broader macroeconomic uncertainties.

Equity Indices: Stability with Sector Variations

The TA-35 index is maintaining its level above 3,620 points, supported by selective gains in large-cap and defensive stocks. Market breadth remains balanced, with 15 advancing stocks versus 19 in decline, and one unchanged. Meanwhile, the TA-90 and TA-125 indices demonstrate divergent trends. The TA-90, heavily weighted toward mid-cap companies, fell 0.18% to 3,770.91 points, with an equal number of advancing and declining stocks (37 each) and 13 unchanged. In contrast, the TA-125 index recorded marginal gains of 0.01%, reaching 3,647.59 points, illustrating resilience in broader market exposure despite sector-specific fluctuations.

Banking and finance-focused indices are showing modest upward momentum. The TA-90 Banks index gained 0.28% to 3,883.30 points, reflecting renewed investor confidence in financials amid solid balance-sheet visibility and defensive positioning ahead of year-end. Meanwhile, the TA-125 Value index advanced 0.36% to 3,969.53 points, suggesting selective interest in value-oriented stocks as investors recalibrate portfolios for 2026.

Bond Market: Steady Yields Amid Active Trading

The bond market is showing consistent activity, with the All-Bond general index rising 0.04% to 420.24 points on trading volume of 38,457,400 NIS. Short-term bonds, particularly the under-one-year index, edged up 0.02% to 465.16 points, while inflation-linked bonds demonstrated a mixed picture. The Tel Bond-60 Index for inflation-linked instruments recorded gains of 0.08% to 414.73 points, contrasted by a 0.04% decline in the Tel Bond-Coupled A index. Overall, the bond market reflects measured investor demand for income-generating and inflation-hedged instruments as global central bank policies and domestic interest rate expectations remain in focus.

Trading activity has been strong across the board. Equity turnover reached 294,645,000 NIS, with bond trading totaling 59,932,000 NIS. These levels indicate continued engagement from institutional investors, hedge funds, and high-net-worth individuals positioning ahead of the year-end, balancing liquidity needs with risk management considerations.

Market Outlook and Key Factors to Monitor

Looking ahead, market participants will be closely monitoring both domestic and international signals. Equity indices may continue to experience mixed movements, driven by sector rotations and global macroeconomic developments, including U.S. Treasury yields and foreign exchange volatility. For bond investors, any shifts in inflation expectations or central bank guidance could influence demand for short-term versus inflation-linked instruments.

Investors should also observe sector-specific catalysts, including banking performance, technology earnings, and industrial output, as these will determine relative index performance in the final trading sessions of 2025. With end-of-year portfolio adjustments underway, liquidity management, risk assessment, and selective allocation remain critical for navigating the current environment effectively.