Israeli stocks and government bonds fell after the Israeli cabinet agreed to call up army reservists, spurring concern air strikes on the Hamas-controlled Gaza Strip may be followed by a ground invasion.

Oil Refineries Ltd. slid to the lowest since it began trading in February 2007 after Calcalist reported that one of the units of the country’s biggest refiner may no longer meet the criteria for its bank loans. Shares in Bank Leumi Le-Israel Ltd. dropped to their lowest in five years.

Israel’s TA-25 Index slid 9.09, or 1.43 percent, to close at 625.84, while the yield on the benchmark Mimshal Shiklit note climbed 4 basis points to 4.78 percent. The country’s benchmark stock index has lost 49 percent this year, the biggest decline since Bloomberg News started collecting data in 1992, amid the worst global financial crisis since the Great Depression.

(Bloomberg.com)