Swiss Equities Rise for Second Day; Swiss Re Rallies

(Corrects spelling of Zuercher Kantonalbank in 15th paragraph.)

Swiss stocks advanced as Libya declared a cease-fire against rebel forces and the Group of Seven nations agreed to sell yen to support Japan following the March 11 earthquake.

Swiss Reinsurance Co. rose for a second day after Barclays Plc raised its recommendation on the shares. Actelion Ltd. (ATLN), Switzerland’s largest biotechnology company, rallied 3.5 percent after an upgrade from Vontobel AG. PubliGroupe SA surged 7.4 percent after reporting a profit.

The Swiss Market Index (SMI) of the biggest and most actively traded companies advanced 0.7 percent to 6,117.06 at 2:03 p.m. in Zurich. The gauge is still heading for a weekly decline of 3.7 percent after the Japanese tremor and ensuing tsunami caused radioactive vapor to leak from the country’s Fukushima Dai-Ichi nuclear power station. The broader Swiss Performance Index gained 0.8 percent today.

“Stocks have been oversold this week and the market’s just retraced up a little way amid low volumes,” said Vanni Vecchini, who sells equities at Louis Capital Markets in London. “Considering what’s at stake -- Japan, Bahrain and the currency issues -- the market hasn’t really come down at all.”

Libya is ceasing all military action and will start talks with the opposition, Foreign Minister Moussa Koussa said in a televised news conference today. The announcement followed the United Nations Security Council’s authorization of the use of force to protect civilians in the North African nation.

Yen Intervention

The G-7 jointly intervened in the foreign-exchange market for the first time in more than a decade after Japan’s currency soared, threatening its recovery from last week’s earthquake. Japan began the effort, with Europe’s central banks following up in their markets, sending the currency down the most against the dollar since 2008.

Switzerland’s central bank doesn’t plan to issue a statement about possible interventions, spokesman Walter Meier said. He declined to comment on whether the Swiss National Bank plans to intervene or is in contact with other central banks on the matter.

Japanese engineers plan to work into the night to restore power to two of the crippled reactors at the damaged Fukushima Dai-Ichi power plant. Tokyo Electric Power Co. said it may finish reconnecting a power line to the No. 1 and No. 2 reactors by tomorrow morning.

Swiss Re gained 2 percent to 50.1 Swiss francs. Barclays raised the world’s second-biggest reinsurer to “equal weight” from “underweight.”

Reinsurance Shares

Reinsurance shares now “fairly reflect” the relative loss from the earthquake in Japan, according to Andy Broadfield, an analyst at Barclays. “Swiss Re is best able to provide solutions” to the Japanese insurance market, Broadfield wrote in a note to clients.

Actelion, whose shareholder Elliott Advisors (UK) Ltd. is trying to remove management, surged 3.5 percent to 49.89 francs.

“We see potential for the share price to climb up to 72 francs,” Andrew Weiss, analyst at Vontobel wrote in a note to customers. Elliot, which holds a 6 percent stake in Allschwil, Switzerland-based Actelion, nominated James Shannon, the former head of global development at Novartis AG, as chairman of the Actelion board, and also proposed five other directors, the hedge fund said yesterday in a statement.

PubliGroupe Climbs

PubliGroupe SA soared 7.4 percent to 116 francs, the highest price in more than a year. Switzerland’s largest advertising company said net income was 42.6 million francs ($47.2 million) for 2010 and announced a dividend of 6 francs a share. Publigroupe made a loss in the prior year.

“The company gave an encouraging outlook,” Patrick Jnglin, an analyst at Credit Suisse Group AG, wrote in a note to clients.

Gurit Holding AG (GUR), the maker of materials for wind energy, gained 3.8 percent to 571 francs. Zuercher Kantonalbank raised the shares to “outperform” from “market perform.”

“The perspective for alternative energies have considerably improved in the last week,” Martin Schreiber, an analyst at the bank, wrote today.

Coltene Holding AG (CLTN), the Swiss dental products company, fell 5.6 percent to 50.25 francs as Zuercher Kantonalbank downgraded the shares to “market perform” from “outperform.”

To contact the reporter on this story: Giles Broom in Zurich at gbroom@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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