Haim Israeli from Merryl Lynch has a different opinion.
Should Morgan Stanley upgrade Israel's status to a developed economy, that would be a catastrophe. Israel would drop from a 2.5 percent share of all the emerging markets to only a 0.3 percent share of developed markets - among this share Teva would rise from 45 to 65 percent [of Israel's relative weighting]. No analyst will invest the necessary time to understand the Israeli economy, its politics and Israel's stature in the world, in order to invest only 0.3 percent of his money, especially while most of it goes to Teva anyway. Changing the status will only scare away investors, as Israel will have to take on markets such as Japan, the U.S. and Europe.
Addendum: The numbers made me aware of the magnitudes: TASE is 0.2% of the market, while NYSE is 50%. We are less than half percent of them. It is therefore logical that TASE follows NASDAQ like a dog, trying to anticipate NASDAQ's emotional state.