No tourists, stocks fall — how the crisis hit Israel's market

Israel's tourism industry has been in deep crisis since October 7. According to the Central Bureau of Statistics, from January to July 2026, only 430,000 tourists visited the country, compared to 1.95 million in the same period in 2019. The decline is reflected on the stock exchange: shares of hotel chains and airlines have fallen, despite the rise of the Tel Aviv 25 and 125 indices. An exception is El Al, whose shares have risen by 276% over three years.

Israel's tourism industry has been in deep crisis since October 7. According to the Central Bureau of Statistics, from January to July 2026, only 430,000 tourists visited the country. For comparison, in the same period in 2019, which was considered a peak year, 1.95 million visits were recorded. The consequences of the crisis are clearly reflected on the Tel Aviv Stock Exchange: a sector once considered attractive for investment has turned into a source of losses, especially against the backdrop of rising key indices. Since the beginning of the year, the Tel Aviv 25 index has risen by 13.2%, and the Tel Aviv 125 by 10%. The war has primarily hit the number of overnight stays. Since the beginning of the year, 8.5 million have been recorded, compared to more than 12.5 million in the same period in 2019. Later, travel agencies and airlines came under pressure, forced to suspend flights amid military operations and attacks. An analysis of the quotes of hotel chains traded on the stock exchange shows a significant decline. Shares of Dan Hotels have fallen by 19.5% since the beginning of the year and by 14.3% over three years. Fattal's shares have fallen by 1% since the beginning of the year and by 72.4% over three years. Isrotel has lost 24% since the beginning of the year and 61% over three years. Israel Canada Hotels, listed for about a year, has shown zero return since the beginning of the year. According to the Hotel Association, the average hotel occupancy in the country has dropped below 50%. The decline has also affected the aviation sector. Shares of Israir have fallen by 17% since the beginning of the year and by 16% over three years. Knafaim's shares have fallen by 9.3% since the beginning of the year. An exception is El Al: its shares rose by 15% in one day after the publication of strong quarterly results and compensated for all losses since the beginning of the year. Over three years, they have jumped by 276% thanks to the fact that during the war the company almost single-handedly provided air transportation for Israelis. The crisis has not spared tour operators either. Shares of Ista have fallen by 15.7% since the beginning of the year, and Kesserei Aviation by 2.25%. The prospects for the industry's recovery remain cautious. The threat of a continuation of the war or a new round of conflict with Iran persists, and many countries have assigned Israel a 'red' or 'orange' status, meaning a travel warning. At the same time, according to market participants, the greatest concern is the deterioration of the country's image and the growth of negative attitudes towards it, which could reduce the tourist flow for a long time. Tel Aviv, which is called one of the most disliked cities in the world and a place avoided by business people, is recording minimal hotel occupancy — on average about 43% since the beginning of the year.