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| By israelinsider staff and partners August 8, 2005 |
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Israel's stock market rebounded Monday after falling 5 percent a day earlier in reaction to Finance Minister Benjamin Netanyahu's resignation. But economists cautioned that Netanyahu's move created an atmosphere of uncertainty since it was unclear if his replacement, Vice Premier Ehud Olmert, would continue with his privatization policies. Olmert has in the past voiced opposition to Netanyahu's fiscal policies.
Olmert and Prime Minister Ariel Sharon decided in a meeting Monday not to make drastic changes to the budget, Israel Radio reported.
Netanyahu resigned Sunday over opposition to Sharon's plan to withdraw Jewish settlers from the Gaza Strip and West Bank beginning next week. After Netanyahu's resignation, the stock market plummeted.
The Tel Aviv stock exchange rebounded Monday, regaining about half its losses, according to the Web site of the financial daily The Marker.
Olmert is slated to present the 2006 budget to the Cabinet on Tuesday, where it is slated to face opposition by Sharon's main coalition partner, the Labor Party.
David Klein, a former bank of Israel governor, told Army Radio that the market was anxiously waiting to see if Olmert would indeed continue with Netanyahu's policies of cutting welfare and unemployment benefits.
The AP contributed to this report.
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