The upcoming October 27, 2026, Knesset elections and ensuing coalition negotiations represent the central driver of trader positioning on whether a new government secures a confidence vote by year-end. The 25th Knesset dissolved in July after completing its term, leaving the 26th Knesset to convene post-election with results expected in early November. Recent polls show persistent fragmentation: Netanyahu-aligned parties, including emerging lists such as Ofer Winter’s, hover near 48–51 seats while opposition groupings reach similar totals but lack cohesion for an immediate majority. This split, compounded by disputes over military draft exemptions, judicial issues, and bloc alignments, typically extends coalition talks for weeks or months in Israel. The modest edge for “No” reflects the historical pattern of delayed government formation amid such arithmetic rather than any single late-August development.