Turmoil in Egypt sparks bargains in Israel, fund manager says

AmerIsrael boss pounces after shares of local energy companies drop nearly 20%

Jan 31, 2011 @ 4:21 pm

By Jeff Benjamin

The continuing political unrest in Egypt created a brief investment opportunity in neighboring Israel, where the stock market Sunday experienced its biggest drop in nearly two years.

“Investors are concerned that the Egyptian [natural] gas contracts may be curtailed in the event that the country descends into chaos,” said Jamia Jasper, founder and president of AmerIsrael Capital Management LLC.

Ms. Jasper, who manages the America Israeli Shared Values Fund Ticker:(AISHX) from New York, sought to take advantage of Sunday’s 3.9% drop by the Tel Aviv 100 Index.

The Israeli stock market, which trades Sunday through Thursday, bounced back 1% on Monday.

“There is not that panic in Israel that there was yesterday,” said Ms. Jasper, who works with an Israel-based analyst.

One major market concern, she explained, is that the supply of natural gas from Egypt could be interrupted.

However, Ms. Jasper pointed out that Israel is virtually energy-independent with regard to natural gas production. Thus, when the market drop Sunday pushed down shares of local energy companies such as Ampal American Israel Corp. Ticker:(AMPL) by more than 20%, Ms. Jasper saw a buying opportunity.

Like a lot of money managers and market analysts who are trying get a sense of the fallout from the turmoil in Egypt, Ms. Jasper has concluded that the market in this instance can move independently from the political unrest.

“Right now, it basically seems like another geopolitical event or another bump in the road,” she said. “And Israel has a long history of rallying after these kinds of geopolitical events.”

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