Swiss Stocks Decline as Selloff in Synthes Shares Offsets Novartis Gain

Swiss stocks fell, sending the Swiss Market Index to a seven-week low, as orders for U.S. durable goods increased less than forecast in July, adding to evidence that America’s economic recovery is stalling.

Synthes Inc. fell 3.4 percent as BofA Merrill Lynch Global Research reiterated its recommendation to sell shares of the world’s largest maker of bone-related medical devices. Cie. Financiere Tradition sank 3.9 percent as the company reported a slump in first-half sales.

The Swiss Market Index of the biggest and most actively traded companies declined 0.7 percent to 6,098.59 at the 5:30 p.m. close in Zurich, the gauge’s lowest level since July 6. The SMI has fallen 12 percent from this year’s highest level on April 15. The broader Swiss Performance Index decreased 0.8 percent to 5,392.58.

U.S. durable-goods orders increased 0.3 percent last month, compared with the 3 percent median estimate of 75 economists surveyed by Bloomberg News, figures from the Commerce Department showed today. Excluding transportation equipment, bookings unexpectedly fell.

U.S. purchases of new homes fell 12 percent from June to an annual pace of 276,000, the weakest since data began in 1963, figures from the Commerce Department in Washington revealed. The median price of $204,000 was the lowest since late 2003.

Synthes lost 3.4 percent to 113.80 Swiss francs. BofA Merrill Lynch reiterated its “underperform” recommendation on the shares following weaker than estimated quarterly results from Medtronic Inc. in the U.S. yesterday. Medtronic management emphasized on a conference call that the market deteriorated further in June and July, according to a report by BofA Merrill Lynch’s Ed Ridley-Day. [bn:WBTKR=CFT:SW]

Cie. Financiere Tradition [] sank 3.9 percent to 103 francs as the company reported that first-half sales fell to 656.4 million francs ($637 million), compared with 743.6 million francs a year earlier.

Tecan Group AG advanced 4.1 percent to 61.65 francs after Credit Agricole Cheuvreux SA raised its recommendation on the shares to “outperform” from “underperform.”

To contact the reporter on this story: Adam Haigh in London at ahaigh1@bloomberg.net

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