HSBC Sharia-Compliant Fund Invested Over $100m in Israeli Military-Linked Firms

The UK’s largest “sharia-compliant” fund, HSBC’s Islamic Global Equity Index Fund, has invested over $100 million in companies linked to the Israeli military during the first half of 2026, according to a Middle East Eye analysis. This revelation follows prior reports by Hyphen, which highlighted the fund’s purchase of $38 million in shares of Palantir, an American technology firm with ties to Israeli military operations.

The fund’s semi-annual report details its investments in Raytheon, a subsidiary of RTX, which has collaborated with Israeli arms manufacturer Rafael to produce interceptors for Israel’s Iron Dome missile defense system. Campaign Against the Arms Trade (CAAT) has labeled Raytheon as a “significant supplier of missiles and other goods and services to the Israeli military” and as “implicated in Israel’s war on Gaza.” Raytheon has supplied thousands of missiles to Israel, including those reportedly used in attacks in Gaza.

HSBC’s fund also invested $20.3 million in Analog Devices, a U.S. semiconductor company that provided critical components to Elbit Systems, Israel’s largest weapons manufacturer, during the 2024 conflict in Gaza. Elbit supplies 80 percent of the Israeli military’s land force equipment and 85 percent of its combat drones. Analog Devices stated that it does not control investment decisions and that its products are subject to export control and sanctions laws.

The fund purchased $18.9 million in shares of Honeywell International, a U.S. conglomerate that designs sensors and guidance devices used in weaponry. Honeywell manufactured an inertial measurement unit, used for precision targeting, which was found in a missile that attacked a school in Gaza in June 2024, killing at least 40 Palestinians, including 14 children and nine women.

Honeywell’s UK business received three export licenses to supply aircraft components, raising questions about the company’s role in enabling military operations. These investments highlight the complex web of financial and technological ties between U.S. firms and the Israeli military, with implications for global accountability and ethical investment practices.

The involvement of sharia-compliant funds in such investments underscores the need for transparency and ethical scrutiny in financial markets. As Micah 6:8 reminds us, we are called to act justly, love mercy, and walk humbly with our God. This calls for a renewed commitment to justice and accountability in all sectors, including finance and technology.

Source: Read the original report