Oct. 12 (Bloomberg) -- Swiss stocks climbed after the Netherlands’ Royal Philips Electronics NV unexpectedly posted a quarterly profit, fueling speculation the earnings season in Europe will show positive surprises.

ABB Ltd., the world’s largest builder of electricity networks, and Roche Holding AG, maker of the Avastin cancer drug, paced gains in the Swiss Market Index. Actelion Ltd. rose after JPMorgan Chase & Co. advised buying the shares.

The SMI, a measure of the biggest and most actively traded companies, increased 104.14, or 1.7 percent, to 6,395.78 as of 1:41 p.m. in Zurich. The broader Swiss Performance Index added 1.5 percent to 5,517.84.

The SMI has rebounded 48 percent from a six-year low on March 9 as economic reports signaled the recession abated and second-quarter earnings beat expectations. The measure jumped 2.3 percent last week.

“I don’t think a lot of people expected Philips to be this good,” said Oslo-based Espen Furnes, whose Delphi Europa fund at Storebrand ASA has gained 51 percent since March 9, according to Bloomberg data. “This is a very good start. There is no doubt that this earnings season will be very crucial. I am still more inclined to buy and have some cash that I am looking to invest somewhere.”

ABB advanced 2.6 percent to 21.92 Swiss francs. Roche increased 2.4 percent to 169.3 francs.

Amsterdam-based Philips, Europe’s biggest consumer- electronics maker, reported net income of 174 million euros ($256 million) in the third quarter as operating earnings at the consumer unit more than doubled. Analysts had predicted a loss of 44.7 million euros, the average of 13 estimates compiled by Bloomberg. The shares surged 6.6 percent.

Analysts’ Estimates

Earnings for companies in Europe’s Dow Jones Stoxx 600 Index may rise 3.7 percent this year and 31 percent in 2010, according to analysts’ estimates compiled by Bloomberg.

Actelion added 1.2 percent to 63.75 francs. JPMorgan raised its price estimate on the shares to 70 francs from 66 francs, after increasing its earnings forecast for the Clazosentan drug being developed for brain damage. The brokerage has an “overweight” recommendation on the shares.

Zurich Financial Services AG, Switzerland’s largest insurer, increased 2.7 percent to 260.25 francs. Credit Suisse Group AG raised its share-price estimate for the insurer to 300 francs from 286 francs, citing “strong” capital markets and “below normal natural catastrophe events.”

Swiss Life

Swiss Life Holding AG, Switzerland’s biggest life insurer, rose 3.3 percent to 133.9 francs, a sixth straight gain in the longest winning streak since June.

Conzzeta AG fell 1.6 percent to 1,820 francs. The holding company said it had a 14.9 million-franc ($14.5 million) net loss in the eight months through August after a profit of 59.8 million francs the same period a year earlier.

Julius Baer Group. Ltd. dropped 1.4 percent to 41.8 francs. The Swiss private bank’s split this month from asset-management business GAM Holding Ltd. was driven by concerns over a possible “large” goodwill writedown, SonntagsZeitung reported, citing an unnamed Julius Baer manager.

To contact the reporter on this story: Alexis Xydias in London at axydias@bloomberg.net.

Last Updated: October 12, 2009 07:56 EDT