States aren't supposed to, it falls under the prohibited powers.
But Texas is Texas.
A law passed in 2017 mandates that the state not invest in companies that boycott Israel.
- Texas Comptroller Glenn Hegar Reminds Businesses About Agency’s Boycott Israel List Amid Israel-Hamas Conflict.
. . . The Hamas terrorists have underestimated Israeli resolve and have invited the full retribution of the Israel Defense Forces (IDF). Similarly, as Israel’s ally, we must not waiver in our support.
“Texas has long been a friend and ally of Israel, and we support Israel’s right to defend its land and people. Companies that do business with the state of Texas should keep that in mind.”
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For more:
- From the Comptroller's office: DIVESTMENT STATUTE LISTS.
- Texas Government Code: Chapter 808.
- HB 89 - 85(R).