TASE bid to join MSCI Europe rejected

TASE head of international sales Sharon Naveh told "Bloomberg.": We may see this great disappointment reflected in the market.

The Tel Aviv Stock Exchange (TASE) has had its application to join MSCI Europe rejected, "Bloomberg" reported last night. "Institutional investors consulted are not supportive of an inclusion of the MSCI Israel Index in the European gauge," New York based index provider MSCI said last night after markets closed.

The TASE management had requested that the stock exchange in Ahad Ha'am Street be included in the MSCI Europe index following a significant drop in trading volumes since the Israeli stock market switched from the emerging markets to the developed markets index in 2010.

TASE head Ester Levanon believes that inclusion in the MSCI Europe index would add up to several billion dollars in trading turnover.

TASE head of institutional and international sales Sharon Naveh told "Bloomberg, "This is a great disappointment and we may see this reflected in the market tomorrow. There were great expectations about an entry into the Europe Index and for the potential inflow of money this move could have brought."

Merril Lynch Israel research department head Haim Israel told “IDF Radio" (Galei Zahal), "MSCI's decision is very problematic and could deal a severe blow to the TASE. The meaning is that most investors worldwide don't want to see Israel on the index and that is not a sympathetic situation. Therefore, we can expect low trading volumes to continue."

However, one senior TASE trader told "Globes that while the decision is disappointing it won't draw a response from the TASE. He said, "The Israeli market had no expectations about being included in the MSCI Europe index so it won't fall because it is not being included."

Published by Globes [online], Israel business news - www.globes-online.com - on June 12, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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