Five things to know ahead of the stock market opening

Trading review: current reports, trends, indices, stock prices, bonds, foreign currency, commodities, and analyst recommendations.

08:15

1. Stock market. Investors in Tel Aviv hope to continue this morning the positive trend from yesterday. One can also draw optimism from yesterday's gains on Wall Street. There, it seems investors are ignoring the ongoing trade conflict between the US and Canada and the "economic D-Day" of US Treasury Secretary Scott Bessent against Iran, ahead of Nvidia's report tonight. The inflation figure to be published this afternoon in the US may affect the local stock market ahead of the closing. Dual-listed stocks are not expected to change much this morning - Palo Alto will drop by 2% at the opening. The company will report its quarterly results next Tuesday, and JP Morgan expects it to show strong results and raised the target price to $384 for December 2027 - reflecting an upside of about 10%. Teva, which is trading at a 9-year high, Tower, Camtek, and ICL are with positive gaps of about 1%. Quarterly reports expected to be published today - Partner and Tiv Taam, among others. The insurance company Harel reported this morning a 30% increase in total profit for the second quarter, which amounted to 1 billion shekels. The company recorded a return on equity of 37%, according to the results presented. The increase in profit was achieved, according to Harel, "thanks to an increase in investment profits and growth in core profits."

Yesterday, gains were recorded in Tel Aviv, the Tel Aviv 35 index climbed by about 0.4%, the Tel Aviv 90 index by 0.7%. The insurance index stood out and jumped by about 3%, following the financial results of insurance companies Phoenix and Menora. The finance and construction indices also stood out, with gains of about 1.8%. The banking index advanced by 0.8%. On the other hand, the Tel Aviv Oil and Gas index stood out negatively and weakened by 1.3%, against the backdrop of the decline recorded in global oil prices. In the Tel Aviv 125 index, payment solutions provider Nayax led, jumping sharply after announcing its largest acquisition to date: the company will pay $350 million in cash for the American company IPS Group, which deals with smart parking technologies. On the negative side, smart sight manufacturer Smart Shooter, which went public in Tel Aviv earlier this year, plummeted in trading following its financial results.

With only a few days left until the end of the month, most indices in Tel Aviv are still in red territory. The Tel Aviv 90 index stands out negatively with a decline of almost 4%. Real estate stocks are on their way to recording another negative month. The defense stocks index also fails to recover so far and completes a double-digit decline. Renewable energy, technology, and food indices are also recording sharp declines. On the positive side, the banking and insurance indices stand out with a rise of 5%-7%.

Trading in Asia is mixed this morning. The Nikkei 225 index in Japan is down 0.25%, the Kospi in South Korea is losing 0.3%, the Hang Seng in Hong Kong and Shanghai in China are rising by about 0.5%. Alibaba stock stands out, rising in Hong Kong by about 3%, after senior management at the Chinese technology company purchased shares of the company. Futures on Wall Street are stable this morning. The market is eagerly awaiting Nvidia's report after the closing. "A good report will not necessarily be enough - investors are looking for a significant positive surprise. The market is trying to understand if it can continue to grow at the current unusual pace," said Uzi Levy, director of securities research at Mizrahi Tefahot.

Earlier, US inflation data will be published. The Personal Consumption Expenditures (PCE) price index for July, the Fed's preferred inflation index, will be published this afternoon. The expectation is a monthly increase of 0.1% and annual inflation of 3.6%, a small decrease compared to June. The figure is published when the bond market is in focus. US government bond yields climbed to multi-year highs last week. Yesterday, a decline in yields was recorded. On Friday, Fed Chair Kevin Warsh will arrive at Jackson Hole, as markets seek an answer: will the Fed continue to fight inflation even at the cost of higher yields - or will it begin to ease the pressure on the debt market.

Yesterday, Wall Street broke the streak of declines. The Dow Jones rose by 0.2%. S&P 500 by 0.3%, while Nasdaq by 0.5% as chip stocks led the gains. The iShares Semiconductor ETF (SOXX) rose by about 1.5%. Nvidia rose by about 2%. Marvell and Super Micro led the gains in the sector, AMD is not far behind, Intel is also rising. Also yesterday - SpaceX plans to build a new launch site worth $100 billion for its Starship rocket on the southern coast of Louisiana, which will allow the company to expand the operation of the giant aircraft, essential for its future. Apple announced upgraded models of Mac mini and Mac Studio computers, with significant upgrades to the processors. The stock of sports retailer Dick's Sporting Goods plummeted. The company disappointed with results and cut its sales forecast. Foot Locker, which it owns, also weighed on the results.

1. Bond markets. The yield on the 10-year US government bond fell by about 6 basis points, to 4.64%. The yield also fell on Monday, after CNBC reported that the US Treasury might use its general account, which holds about $1 trillion, to finance bond buybacks. Interest rate strategists at Goldman Sachs, Wells Fargo, and other companies on Wall Street said that the bond purchases being carried out by the US Treasury will do very little to reverse the rise in long-term bond yields. "The US Treasury's decision to increase bond purchases in the long part of the yield curve does not address what we see as the main sources of recent volatility in long-term bonds," wrote Goldman Sachs strategists, including George Cole and William Marshall, in a study published on August 21. "In our assessment, the bond purchases themselves are not expected to significantly change yield levels, even if they are expanded."

2. Commodity and currency markets. The dollar is trading in a mixed trend against the shekel, after crossing the 3 shekels per dollar threshold in the morning hours, finally the representative rate was set at 2.986. Since the beginning of the year, gold has been treading water and even recorded sharp declines. But precisely since the beginning of August, the yellow metal has jumped by 16%. "Gold prices have erased a significant part of the sell-off that the metal experienced in the summer. The move is supported by weaker economic data in the US in July, alongside a re-examination of the Federal Reserve's credibility and increasing activism by the US Treasury in the financial markets," write the Swiss wealth management bank Pictet. The meaning is a renewed erosion of the dollar. "This is what brought back to the center of attention what investors call 'currency debasement trade'... This strengthens our view for the medium to long term, according to which the structural headwinds applied to the US dollar are expected to continue to support precious metals."

Gold futures for delivery in December opened on Tuesday, August 25, 2026, at a price of $4,710.10 per troy ounce, an increase of 0.3% compared to the closing price on Monday. The price of gold is falling slightly this morning, and stands at $4,697.60 per ounce as of 7:52 AM Eastern Time in the US. Bitcoin jumped briefly above $80,000 yesterday, for the first time since May, against the backdrop of the Trump administration's efforts to curb long-term interest rates, which bring back to the discourse what is called the "dollar debasement trade." Concerns about the erosion of the dollar's value as a result of inflation and uncontrolled government spending have fueled for years the argument in favor of Bitcoin, which was created as an alternative to traditional currencies backed by states. On the other hand, skeptics argue that the digital currency is very volatile, and that in practice it has not served as an effective hedge against inflation. US President Trump gave Bitcoin an additional boost last week, when he called on Congress to pass the Clarity Act, a bill that has been delayed for a long time and was intended to create a legal framework for digital assets.

1. Macro. According to Shmuel Katzavian, chief strategist at Discount Bank, the Bank of Israel's next interest rate decision is still open. "At this stage, there is no clear scenario, and an interest rate cut (by 0.25%) or leaving it unchanged are two possible scenarios. The Governor of the Bank of Israel himself said recently that the next interest rate decision is not predetermined ('will be a live one'), meaning both options are still on the table. "However, we estimate that looking further ahead, the interest rate reduction process in Israel has not yet ended and the interest rate in a year will be lower than the market pricing. In our assessment, the more likely scenario is at least two interest rate cuts in Israel."

"Also in a unique and long-term analysis - the interest rate in Israel is too high compared to the economic background conditions. A different way 'from a bird's eye view' to examine the interest rate in Israel is a comparison of the current interest rate level to the interest rate level in Israel throughout history, and performing a parallel comparison regarding the inflation rate and the growth rate. Today in Israel it is higher than the interest rate that was in 72% of the months in the last 20 years. Also compared to the last decade, the interest rate in Israel today is in a relatively high percentile (64%).

In the US, the main event will happen in the afternoon - the PCE index data, the preferred inflation figure of the Federal Reserve, and it will precede an event no less important that will happen on Friday - the speech of the US central bank governor. "It is likely that he will focus on productivity, artificial intelligence, and the Fed's balance sheet, and not on providing clear guidance regarding the interest rate decision in September and beyond. However, after another week of volatility in the bond market, even avoiding clear guidance will not be perceived as neutral," says Ofer Klein, head of the economics and research division at Harel Insurance and Finance. In the US, discouraging macro data were published yesterday: Consumer confidence in the US fell in August to its lowest level since January, when the cost of living and the slowdown in the pace of hiring workers weighed on how Americans perceive the state of the economy, a few months before the critical midterm elections. At the same time, new home sales in the US fell to their lowest level since January, when the high interest rate on mortgages remained in place and keeps potential buyers away.

1. Forecast. In recent weeks, Camtek stock has been suffering from the negative sentiment of chip stocks globally. Thus, since August 12, it has lost over 16%, and according to analysts from Bank Hapoalim, it has already become an opportunity. Hapoalim is raising the recommendation for Camtek stock from "market perform" to "outperform" (at high risk), without change in the target price which remains $168 and reflects a premium of 18%. Dual-listed Camtek is a manufacturer of inspection systems for chip manufacturers. Shai Zigelman, an equity analyst in the research unit at Bank Hapoalim, emphasized that the recommendation upgrade comes from pricing considerations: since the last reports, the stock has weakened, and according to him, "at the current price, Camtek is trading at about 29 times our profit forecast for 2027 and at about 26 times excluding cash. From our perspective, the decline in the stock has improved the risk-reward ratio to a degree that justifies raising the recommendation." Zigelman notes, however, that the recommendation upgrade is being done during a period of weakness in chip stocks (following questions in the market whether the unusual investment volumes in artificial intelligence infrastructure will continue to grow), and therefore the risk is defined as high. In his assessment, Nvidia's reports this week will be an important test for the entire chip industry, including Camtek.