JERUSALEM (Reuters) – Bank of Israel Governor Stanley Fischer said on Sunday Israel could become a leading economy globally if a Middle East peace deal is reached but that the key challenges for now were to accelerate growth and cut poverty.

The Zambian-born, U.S. and British educated Fischer, in a speech after he was sworn in for a second five-year term as central bank chief, said economic success hinged on maintaining a strong military.

“This economy, with its dynamism and creativity, could grow much faster if we were to achieve peace with our neighbors,” said Fischer, 66, who is credited with helping to keep Israel’s economy and financial markets afloat during the global downturn.

“If we were to achieve it, we could within one or two decades find ourselves living in one of the most advanced economies in the world,” he said.

Over the long term, Israel’s economy needs to be as successful as being able to defend itself militarily, he said.

“These two factors — the economic and the military — are intertwined, and their interconnections are very complex,” Fischer said.

Fischer — a former professor of Federal Reserve Chairman Ben Bernanke — accepted a second term as head of the Bank of Israel in March after parliament approved a bill that makes the central bank’s policymaking more transparent.

JERUSALEM (Reuters) – Shares of Teva Pharmaceutical Industries <TEVA.TA> slid nearly 3 percent on Sunday after a jury ruled that Teva infringed on Pfizer Inc’s <PFE.N> Protonix acid reflux drug patent.

Israel-based Teva <TEVA.O> has been selling a generic version of Protonix since 2007. It was considered an at-risk launch, with the original patent on Protonix held by Swiss drugmaker Nycomed <NYCMD.UL> and was licensed to Wyeth, which is now owned by Pfizer.

The announcement came shortly before U.S. markets closed on Friday and Teva’s Nasdaq-listed shares rose 0.8 percent to $61.54. In after-hours trade, Teva shares fell to a low of $60.43 but closed at $61.20.

Shares of Teva, the world’s biggest generic drugmaker, were down 2.9 percent at 225.3 shekels in afternoon trade in Tel Aviv. The broader bourse was up 1.2 percent.

Analysts were surprised at the steep decline in Teva’s shares since Teva plans to appeal and there were still legal issued to be decided by the judge presiding over the case.

“It’s not the final verdict,” said Natali Gotlieb, an analyst at the IBI Investment House. “It’s still too early to know if Teva will have to pay anything.

“Maybe in the end, they will reach a settlement with Pfizer so there are so many scenarios.”

JERUSALEM, April 6 (Reuters) – Israel’s blue-chip Tel Aviv 25 index <.TA25> rose 0.4 percent to close at an all-time high on Tuesday, as strong economic growth continued to buoy the stock market.

In the first full trading day since March 28, the TA-25 index <0#.TA25> closed at 1,237.85 points in moderate volume of 1.6 billion shekels ($432 million) to eclipse a previous high of 1,237.13 set on Oct. 31, 2007. It had risen as high as 1,242.39 early in the session before selling emerged.

The broader TA-100 index <.TA100> edged up 0.2 percent to 1,160.95. Government bond prices <0#ILGOI=TA> closed 0.2 to 0.8 percent lower, while the shekel <ILS=> was mostly flat at 3.7 per dollar.

Israel’s equities market had either been closed or traded in shortened sessions since March 29 due to the seven-day Jewish Passover holiday. Its previous trading session was last Thursday.

After surging some 70 percent in 2009, the Tel Aviv bourse is up another 8 percent so far in 2010 on the heels of a rapidly rebounding economy.

“Israel’s economy only had a two-quarter recession and now we are back to trend growth,” said Saar Golan, a trader at the Clal Finance brokerage. “The general mood in the markets are for continued gains — even if (some) people are calling for a correction.”

The economy contracted in the fourth quarter of 2008 and first quarter of 2009 before posting positive growth starting in the April-June period of last year. Growth was an annualised 4.9 percent in the fourth quarter and the economy is expected to grow at least 3.5 percent in 2010.

JERUSALEM, March 24 (Reuters) – Fertiliser and specialty chemicals maker Israel Chemicals (ICL) <ICL.TA> reported a smaller than expected 15 percent rise in quarterly net profit and said it saw signs of recovery in potash demand.

The world’s sixth largest maker of potash, which is used to boost crop yields, said: “Signs of further recovery have been evident during the first quarter of 2010, including the signing in March of potash supply agreements totalling 1.43 million tonnes with Indian customers.”

Major fertilizer majors had a dismal 2009 but the outlook is improving as the sector looks to the typically strong spring season.

The sector has also witnessed a frenzied round of consolidation, which has seen CF Industries Holdings Inc <CF.N> buy rival Terra Industries Inc <TRA.N> for more than $4.6 billion after Norwegian rival Yara International ASA <YAR.OL> decided not to raise its offer for Terra.

Shares in ICL closed down 0.9 pct at 50.30 shekels after hitting an all time high of 50.74 on Tuesday. The stock has underperformed that of its rivals, which have gained on takeover hopes, as it not regarded as a likely target.

“Recent positive news on ICL’s Indian contracts and a solid outlook for 2010 may help reverse some of this recent underperformance,” Citi analyst Sophie Jourdier wrote in a client note.

ICL posted net profit of $202.7 million, compared with $175.8 million a year earlier. Excluding one-off charges, ICL recorded profit of $279.1 million in the fourth quarter of 2008.

TEL AVIV, March 16 (Reuters) – Bezeq Israel Telecom <BEZQ.TA> said on Tuesday it did not expect to lose foreign investors in May after Israel’s equity market moves to developed market status from an emerging markets.

Chief Financial Officer Alan Gelman said Bezeq, Israel’s largest telecoms group, has boosted its foreign investor base to 43 percent from 17 percent a year ago.

“It’s hard to say we will do much better than 43 percent,” Gelman said at a conference that unveiled a Thomson Reuters Extel survey showing most foreign investors unlikely to increase their Israeli exposure after the switch. [ID:nLDE62F0ZF]

He said Bezeq could even gain “a couple of percentage points”.

Gelman said it will be a tough road for Israeli companies to attract developed market investors, partly due to the fact they will have to compete on valuations with larger peers.

He added that developed market investors and funds use different criteria to judge companies.

As for Bezeq, Gelman said that in anticipation of the MSCI upgrade, the company has raised its free float to 70 percent.

JERUSALEM, March 15 (Reuters) – Brazil expects a new free trade agreement with Israel to swell bilateral trade to more than $3 billion within five years, officials said on Monday.

Trade between Israel and Brazil slipped below $1 billion in 2009 from a peak of $1.6 billion in 2008 — $1.2 billion of which were Israeli exports — due to the global economic crisis.

But a new free trade agreement between Israel and the Mercosur bloc — Brazil, Argentina, Paraguay and Uruguay — goes into effect in early April. Israel is the first non-Latin American country to sign such a trade deal with Mercosur.

Brazil gave its final approval to the pact on March 4, a week after Paraguay.

“We will triple trade between Israel and Brazil by 2015,” Paulo Skaf, president of the Federation of Industries of the State of Sao Paulo, said at a conference in Jerusalem attended by President Luiz Inacio Lula da Silva, Israeli President Shimon Peres and a group of Israeli and Brazilian business leaders.

Brazil is Israel’s largest trading partner in Latin America, with a number of large Israeli companies already exporting to Brazil.

Defence contractor Elbit Systems <ESLT.O> is a supplier to Embraer <EMBR3.SA> <ERJ.N>, the world’s third-largest aircraft manufacturer, while fertiliser maker Israel Chemicals <ICL.TA> and generic agrochemical company MA Industries <MAIN.TA> have significant exports.

JERUSALEM, March 10 (Reuters) – Israel’s parliamentary finance committee on Wednesday approved a controversial bill that would revamp the framework for policymaking at the Bank of Israel.

Bank of Israel Governor Stanley Fischer, whose five-year term ends at the end of April, has hinged staying on for a second term on passage of the bill.

Moshe Gafni, the head of the committee, said in a statement: “We approved the new Bank of Israel Law after 50 years and there is no doubt it is historic.”

Fischer welcomed the decision.

“This is a good law that will let the bank continue its work efficiently, transparent to the public, the parliament and the government,” Fischer said.

Final approval is still needed by parliament.

Under the proposed bill, monetary policy decisions would be made by a six-member board headed by the governor.

JERUSALEM, March 2 (Reuters) – Cellcom Israel <CEL.N> <CEL.TA>, Israel’s largest mobile phone operator, reported higher quarterly profit on Tuesday that beat estimates, but said intensifying competition looks set to limit growth in 2010.

Like its rivals, Cellcom overcame a difficult economic environment and posted a 4 percent rise in revenue, despite a decline in airtime revenue stemming from ongoing price erosion.

Its shares fell 1.6 percent to 128.90 shekels in a rising market as analysts called the results uninspiring, and said further growth in 2010 would be challenging.

“Given the risk of competition, we believe the stock is fully priced,” said Gilad Alper, an analyst at the Excellence Nessuah brokerage. He maintained a “market perform” rating and 120 shekel price target.

Analysts cited already fierce competition from Partner Communications <PTNR.TA> and Pelephone, Israel’s second and third largest mobile operators, and the possible addition of virtual operators later this year.

“Cellcom presented only a reasonable report that clearly presented its problem — it doesn’t have new engines of growth,” said Ori Licht, an analyst at IBI Investment House, noting that Cellcom’s results were weaker than those of Partner <PTNR.O>.

With Israel’s mobile phone penetration above 100 percent, Cellcom and Partner began offering domestic calling via Voice over Broadband, but revenue has been low so far.

JERUSALEM (Reuters) – Bank of Israel governor Stanley Fischer flew to China on Wednesday to urge Beijing to back tough sanctions against Iran over its suspected nuclear weapons project.

Fischer, known to China from his time as a senior official of the IMF and World Bank, was accompanied by Israel’s minister for strategic affairs, Moshe Yaalon, and representatives of Israel’s National Security Council, Yaalon’s spokesman said.

“They will discuss issues of common interest with the Chinese. This includes the Iranian issue, which is important for the Chinese as well as Israel,” he said.

Israeli Prime Minister Benjamin Netanyahu this week called for an immediate embargo on Iran’s energy sector.

Of the five members of the United Nations Security Council with veto power, China is most resistant to employing global sanctions to force Tehran to abandon its alleged atom-bomb plans, saying diplomacy can resolve the issue.

Beijing sees Iran as an important oil supplier and trade partner and a major strategic actor in the Middle East, where China, the world’s No. 2 crude oil consumer, is buying growing volumes of oil.

Iran has the world’s second-largest crude oil reserves, but desperately needs investment to develop them. It denies working to develop a nuclear warhead but insists on its right to create nuclear power-generating capacity.

JERUSALEM, Feb 15 (Reuters) – Bank Leumi <LUMI.TA> Chief Executive Officer Galia Maor has ended a stand-off with the government and regulators over her bid to become chairwoman of Israel’s biggest bank by withdrawing her candidacy.

Her backers argued she had “special talents” which should exempt her from a rule requiring a two-year cooling-off period between being a bank executive and serving as a director.

Israel’s finance and justice ministers, the securities watchdog and the attorney general said she must abide by the regulations.

Leumi said Maor, who has been CEO for 15 years, would stay in her post.

“Mrs. Maor informed the bank today that in light of the circumstances created since presenting her candidancy as a director of the bank … she came to a personal decision to withdraw her candidancy to serve as bank director,” Leumi said in a statement to the Tel Aviv Stock Exchange on Monday.

Leumi’s appointments committee in late January recommended making Maor a director, which would have made her a strong contender to become chairwoman.

“Leumi is my home,” Maor wrote in a blog on Leumi’s website.