Israeli recession is over, prospects are good

Israel has high levels of economic, institutional and financial strength, and the country's recession now appears to be over, Moody's Investor Services said yesterday in its annual report on Israel.

The international rating agency left Israel's long-term government foreign currency bond rating at A1 with a stable outlook.

Moody's said Israel's economy has largely weathered the global meltdown, but warned the country's small size means robust growth hinges on developments abroad. It added short-term prospects were relatively good.

Israel's Real Estate Market Remains Hot

Unlike nearly anywhere else in the world right now, Israel's real estate market is thriving. Home sales in Israel jumped 57% in June of this year, compared to the same month in 2008. June 2009 saw 1,540 homes sold nationwide, compared to just 980 a year earlier.

The Jerusalem area, where 30% of all apartments sold were located, has become one of the country's hottest areas. Overall, 92% more apartments were sold in the Yerushalayim area during the first half of 2009, compared to the same period a year earlier.

Real estate stocks fuel powerful rally in Tel Aviv

Tel Aviv stocks opened the trading week with a bang, powering north on unusually high turnover for a Sunday. To inject a moment of sobriety, the leading Tel Aviv indices had fallen so far last year that the gains in 2009 haven't fully compensated for the losses.

The TA-25 index is still 22% below its all-time high, for example. The Real Estate-15 index, which has gained 130% this year, is still 65% below its peak.

Yesterday the TA-25 index gained 1.9% to 968 points and the broader TA-100 index advanced by 2.1% to close at 904 points. The Real Estate-15 index gained 4.5%