Financial experts and regulators touted the strength of the Israeli economy, tech sector and stock exchange after a year and a half of war during a panel at the Milken Institute Global Conference in Beverly Hills on Wednesday, saying that “resilience” is a “very core characteristic of the Israeli market.”

The panel, titled “Time to Build: Accelerating and De-risking Israel’s Economic Growth and Recovery,” featured Seffy Zinger, chairman of the Israel Securities Authority; Eugene Kandel, chairman of the Tel Aviv Stock Exchange; Tilli Kalisky-Bannett; managing partner at Pinegrove Venture Partners; and Michael Kashani, head of sustainable credit and platforms at Apollo Global Management. 

Zinger admitted that after Oct. 7, “we as financial regulators were preparing ourselves again and again to collapse in the markets,” but “again and again, we found ourselves wrong.” 

He told the story of the night of April 13, 2024, when Iran shot hundreds of drones and missiles at Israel, and as Israelis waited for the missiles to reach them, he received “dozens of calls and WhatsApps and text messages — all warned me that tomorrow we will see a bloodbath in the markets. Some of them urged me not to open the stock exchange.” To his surprise, though, “the day after came … and what we saw in the end of that day in the [Tel Aviv Stock Exchange] screen was green.”

Likewise, Zinger said, after President Donald Trump announced his tariff plan last month, the Israeli market saw only modest declines “comparing to what we saw in the world, compared to what we saw in New York.” 

In 2024, he remarked, the Israeli stock exchange did better than the S&P 500: “You compare Israel, which was [in] a year of one of its worst wars in the last 30 or 40 years, comparing to the United States in one of its best years. And still, the Israeli market did better.” Zinger said that “reflects something, [a] very core characteristic of the Israeli market, which is its resilience.”

Kalisky-Bannett addressed the success of the tech sector in Israel, which, despite being “the size of New Jersey” is the “third largest tech hub after Silicon Valley and New York,” accounts for 10% of global unicorns and makes up 20% of Israel’s GDP and 70% of its exports.

After Oct. 7, Kalisky-Bannett said that Israel “saw was a small dip in in funding of Israeli tech companies that, by Q4 [the fourth quarter of 2023], came back, and in part that is a result of CEOs that were on the front line but had come up with continuity plans, companies that had relocated individuals in order to create their business continuity, and then a resurgence of investments in 2024 and a resurgence of exits in 2024 as well.” 

She referenced a story told earlier in the conference by Nvidia CEO Jensen Huang who was asked what makes him and his company successful, “and he believes it’s a history of suffering. … For the Jewish nation and for the Israelis, I believe that we have also had our fair share of suffering, which has, on the positive side, spawned a nation of very resilient, creative individuals who have to survive at all costs.”

Kandel suggested that the audience to “forget about the fact that you care about Israel” and to “think about Israel as an investment pitch.” To that end, he highlighted the sale of Tel Aviv Stock Exchange (TASE) stock in January 2024, when it took only three weeks to sell 20% of the shares of the exchange itself. Among the purchasers were 12 new foreign investors, including billionaire Bill Ackman who — along with his wife, Neri Oxman — purchased a nearly 5% stake in TASE for $17 million. (Ackman would later say, “We wanted to buy more but that’s all they had available for sale. … We view TASE as a permanent holding.”)

“If you look at the annual data, annual returns of the Tel Aviv Stock Exchange index, you look over the last 25 years,” Kandel said, “you would not find a war in those numbers. Even in 2023, let alone 2024, the market bounced down of course after Oct. 7, but it bounced back within two months.”

Kalisky-Bannett called attention to potential weaknesses in the Israeli market, including the race for AI supremacy. She said she believes Israel “has the opportunity and the potential to be at the forefront of AI research and development” behind the U.S. and China, but that not enough investment is happening in the industry yet. 

Instead, she said, cyber, which represents about 7% of Israeli companies, received 36% of venture capital investments in 2024, along with a boom in aerospace, defense and government R&D spending. “But what we don’t see enough of is this AI, and it’s going to be existential and very important for the Israeli innovation economy.”

She also warned of the danger of 70-80% of funding for the Israeli tech sector coming from foreign investors, primarily in the U.S., which she called a “single point of failure” that “Israeli regulatory bodies are trying to amend.” One of those efforts is Yozma 2.0, which aims to bring institutional capital into the “local venture scene” (Yozma 1.0 was an effort to bring foreign funds into Israel in the ‘90s), as well as an expansion of the “Angel’s Law” that provides substantial tax incentives to investors in Israeli startups. 

The speakers also discussed potential in Israel’s postwar recovery in sectors such as building energy security; reimagining Israel’s lending system to mix capital markets, philanthropy and government funding; and using private credit to address the impact of the war on mortgages in the western Negev where many homeowners were killed or displaced.