US semiconductor giant Intel Corp. has inked an agreement in principle with the Israeli government to build a chip manufacturing plant in Kiryat Gat at an investment of $25 billion.
Prime Minister Benjamin Netanyahu said the Intel investment was “unprecedented” in Israel and would go toward building a chip manufacturing plant that will use the most advanced technology in the world. In 2019, Intel already held talks for an investment of around $10 billion into building the Kiryat Gat chip plant.
“This is the largest investment ever in the State of Israel,” Netanyahu said at the weekly cabinet meeting on Sunday. “This is an expression of great confidence in the Israeli economy and exactly reflects the strength of the free economy that we have built here, and the technological economy that we are developing here.”
The announcement was made after an agreement in principle was reached between Intel and the Finance Ministry on the investment plans. As part of the agreement, Intel will pay a 7.5% tax rate, up from the 5% the chipmaker pays the state today, the Finance Ministry said in a statement. In addition, it was agreed that Intel would get a government grant at a rate of 12.8% of the investment amount under the Encouragement of Capital Investment Law (ECIL).
The Kiryat Gat factory is expected to open by 2027 and remain in operation until at least 2035, employing thousands of workers at higher-than-average wages, the ministry said.
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“Intel’s investment will yield significant economic benefits to the State of Israel in general and to the southern region in particular,” said Budget Commissioner Yogev Gardos. “The negotiations with the company were… based on economic models to examine the benefits of the investment, in order to maximize value for the Israeli public while promoting investment in Israel against the alternative options available to Intel globally.”
Intel core processor Intel vPro. (Courtesy)
Since entering Israel in 1974, Intel has invested more than $17 billion in Israel and employs 11,700 employees at its three R&D centers — in Haifa, Petah Tikva and Jerusalem — as well as at its manufacturing plant in Kiryat Gat. Intel says it is currently responsible for creating indirect employments positions for approximately 42,000 workers in Israel.
“Israel is a global center of technical talent and innovation and one of Intel’s significant global manufacturing and R&D centers,” Intel said in a statement. “Our intention to expand manufacturing capacity in Israel is driven by our commitment to meeting future manufacturing needs and supporting Intel’s IDM 2.0 strategy, and we appreciate the continued support of the Israeli government.”
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Last year, Intel acquired Israeli computing tech startup Granulate for a reported $650 million, marking the chipmaker’s seventh purchase of an Israeli company in just over five years.
The tech giant bought Mobileye, a Jerusalem-based maker of self-driving technologies, in 2017 for over $15 billion, a transaction that remains an Israeli company’s biggest exit to date. Mobileye has become a central part of Intel’s global operations as it looks to a future with fully autonomous vehicles.
Last week, Intel disclosed that Intel Israel in 2022 posted record exports of $8.7 billion, constituting 1.75% of Israel’s entire GDP and 5.5% of all Israeli high-tech exports, according to the firm’s corporate responsibility report. Furthermore, Intel Israel purchased $3.5 billion in goods and services from Israeli businesses, up 60% from the $2.2 billion recorded in 2021.
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
The crypto market has recently experienced a significant downturn, mirroring broader risk asset sell-offs. Over the past week, Bitcoin’s price dropped by 24%, reaching $53,000, while Ethereum plummeted nearly a third to $2,340. Major altcoins also suffered, with Cardano down 27.7%, Solana 36.2%, Dogecoin 34.6%, XRP 23.1%, Shiba Inu 30.1%, and BNB 25.7%.
The severe downturn in the crypto market appears to be part of a broader flight to safety, triggered by disappointing economic data. A worse-than-expected unemployment report on Friday marked the beginning of a technical recession, as defined by the Sahm Rule. This rule identifies a recession when the three-month average unemployment rate rises by at least half a percentage point from its lowest point in the past year.
Friday’s figures met this threshold, signaling an abrupt economic downshift. Consequently, investors sought safer assets, leading to declines in major stock indices: the S&P 500 dropped 2%, the Nasdaq 2.5%, and the Dow 1.5%. This trend continued into Monday with further sell-offs overseas.
The crypto market’s rapid decline raises questions about its role as either a speculative asset or a hedge against inflation and recession. Despite hopes that crypto could act as a risk hedge, the recent crash suggests it remains a speculative investment.
Since the downturn, the crypto market has seen its largest three-day sell-off in nearly a year, losing over $500 billion in market value. According to CoinGlass data, this bloodbath wiped out more than $1 billion in leveraged positions within the last 24 hours, including $365 million in Bitcoin and $348 million in Ether.
Khushboo Khullar of Lightning Ventures, speaking to Bloomberg, argued that the crypto sell-off is part of a broader liquidity panic as traders rush to cover margin calls. Khullar views this as a temporary sell-off, presenting a potential buying opportunity.
Josh Gilbert, an eToro market analyst, supports Khullar’s perspective, suggesting that the expected Federal Reserve rate cuts could benefit crypto assets. “Crypto assets have sold off, but many investors will see an opportunity. We see Federal Reserve rate cuts, which are now likely to come sharper than expected, as hugely positive for crypto assets,” Gilbert told Coindesk.
Despite the recent volatility, crypto continues to make strides toward mainstream acceptance. Notably, Morgan Stanley will allow its advisors to offer Bitcoin ETFs starting Wednesday. This follows more than half a year after the introduction of the first Bitcoin ETF. The investment bank will enable over 15,000 of its financial advisors to sell BlackRock’s IBIT and Fidelity’s FBTC. This move is seen as a significant step toward the “mainstreamization” of crypto, given the lengthy regulatory and company processes in major investment banks.
The recent crypto market downturn highlights its volatility and the broader economic concerns affecting all risk assets. While some analysts see the current situation as a temporary sell-off and a buying opportunity, others caution against the speculative nature of crypto. As the market evolves, its role as a mainstream alternative asset continues to grow, marked by increasing institutional acceptance and new investment opportunities.
