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Swiss Benchmark Index Fluctuates; Syngenta Drops, Credit Suisse Advances
Stocks in Switzerland fluctuated, erasing their gains as Syngenta AG declined and a report showed orders for U.S. durable goods unexpectedly fell in June.
Syngenta slid 2.2 percent after it was downgraded at JPMorgan Chase & Co. The pesticide maker’s drop offset Credit Suisse Group AG’s 1.1 percent advance after Deutsche Bank AG raised its recommendation for the European banking sector.
The benchmark Swiss Market Index was little changed down less than 0.1 percent at 6,277.49 as of the 5:30 p.m. close in Zurich, paring yesterday’s 1.2 percent rally. The SMI has retreated 10 percent from this year’s high on April 15 amid speculation that Europe’s debt crisis may derail the economic recovery and concern that Chinese authorities are cooling their nation’s rate of growth. The broader Swiss Performance Index lost less than 0.1 percent today.
A report today showed total U.S. orders for durable goods - - products meant to last at least three years -- unexpectedly fell 1 percent in June, figures from the Commerce Department showed in Washington.
Economists forecast durable goods orders would climb 1 percent, according to the median of 76 predictions in a Bloomberg News survey. The Commerce Department revised the number of orders in May to show a 0.8 percent drop compared with a previously reported decrease of 0.6 percent.
Syngenta, EFG Down
Syngenta shares fell 2.2 percent to 227.60 Swiss francs, erasing two days of gains. The chemical maker was downgraded to “neutral” from “overweight” at JPMorgan, which said that cost inflation was putting pressure on the company’s margins.
EFG International AG, the Swiss bank controlled by Greek billionaire Spiro Latsis and his family, plummeted 20 percent to 12.55 francs, its largest decline since March 2009. It swung to a loss in the first half after writing off 859.5 million francs ($829.2 million) on three asset managers.
Advanced Digital Broadcast Holdings SA, the Swiss maker of digital-television equipment, slumped 6.5 percent to 29.70 francs, its steepest fall in a week. It said its earnings per share were $0.50 in the first half and sales were $141 million. The company said that a “slight delay” in bringing new products to the market had pushed some sales into the second half.
“Financial shares are getting a boost this week from the watered-down Basel III requirements and the Deutsche Bank sector upgrade today,” Mads Koefoed, a market strategist at Saxo Bank A/S in Copenhagen said today. “The new version is much less restrictive regarding Tier 1 capital, and the sector’s rise is thus a perfectly natural consequence.”
Credit Suisse, Switzerland’s second-largest bank, gained 1.1 percent to 48.11 Swiss francs, up 9.8 percent in the past four days.
Banking Upgrade
Deutsche Bank upgraded the European banking industry to “neutral” from “underweight,” saying that “worries over leverage ratios, funding, and liquidity requirements are now much reduced.”
The Basel Committee, which represents central banks and regulators in 27 nations and sets capital standards for banks worldwide, buoyed investors’ confidence after saying lenders can count deferred tax assets and minority stakes in financial firms as capital. The committee’s new proposals came three days after all but seven of Europe’s 91 biggest banks passed the European Union’s stress tests.
Drug Recommendations
Roche Holding AG, rose 1.4 percent to 137.60 francs. Its Xeloda and MabThera medicines received final recommendations from the U.K. agency that approves all new drugs. Roche can now sell the medicines to the state-run National Health Service.
Transocean Ltd., the owner of the Deepwater Horizon offshore rig that sank in the Gulf of Mexico in April, jumped 2.6 percent to 50.25 francs, up 7.6 percent in the past two days.
ABB Ltd., the world’s largest builder of electricity networks, increased 1.1 percent to 21.27 francs, paring yesterday’s 1.3 percent slide. It was raised to “outperform” from “market perform” at Sanford C. Bernstein & Co.
To contact the reporter responsible for this story: Adam Ewing in Stockholm at aewing5@bloomberg.net.
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