Syngenta AG (SYNN), a maker of crop protection chemicals, fell 2.2 percent. Lonza Group AG (LONN), which makes chemicals for drugmakers, also dropped. Swiss Life Holding AG (SLHN) rose 4.1 percent as European insurers advanced.
The Swiss Market Index (SMI) of the biggest and most actively traded companies lost 0.2 percent to 6,145.16 at the 5:30 p.m. close in Zurich. The measure has declined 4.5 percent this year. The broader Swiss Performance Index (SPI) decreased 0.1 percent today to 5,644.42.
“Even though I do not expect a default of Greece in the short term it appears to be a realistic scenario in the mid-term,” said Kai Fachinger, who manages over $1 billion in equities at SAM Sustainable Asset Management AG in Zurich. “The financial industry is still not able to digest a haircut in Greece. I expect the macroeconomic situation to remain bumpy.”
German Chancellor Angela Merkel retreated from demands that bondholders be forced to shoulder a substantial’’ share of a Greek rescue, saying she’ll work with the European Central Bank to avoid disrupting markets.
“We would like to have a participation of private creditors on a voluntary basis,” Merkel told reporters in Berlin today at a joint press conference with French President Nicolas Sarkozy. This “should be worked out jointly with the ECB and there shouldn’t be any dispute with the ECB on this.”
Confidence among U.S. consumers dropped more than forecast in June as households contended with higher prices that are eating into incomes amid slowing job growth.
The Thomson Reuters/University of Michigan preliminary index of consumer sentiment decreased to 71.8 from 74.3 in May. Economists forecast a reading of 74, according to the median estimate in a Bloomberg News survey.
Syngenta lost 2.2 percent to 272.80 francs for the biggest decline in the SMI. Lonza Group fell 1.3 percent to 66.30 francs.
SGS SA (SGSN), the world’s largest goods inspection company, dropped 0.8 percent to 1,586 francs after saying it acquired Correl Rail Ltd., a U.K. certification company with 2.1 million pounds ($3.4 million) in revenue.
Swiss Life Surges
Swiss Life, the nation’s largest life insurer, jumped 4.1 percent to 138.90 francs.
“Insurers with strong exposure to Greece have risen with news suggesting a political consensus on rescuing the country and this has a knock-on effect on Swiss insurers even if they are not heavily exposed to Greek treasuries,” Simon Weiss, an analyst at Credit Suisse Group AG (CSGN) in Zurich, said by phone. “The best case scenario for financials would be a financing solution that doesn’t rely too much on private sector involvement.”
Acino Holding AG, the Swiss maker of generic drugs, climbed 1.8 percent to 85 francs. Acino and Bayer HealthCare Pharmaceuticals signed a multiyear manufacturing contract for Bayer’s contraceptive patch, the company said today. The total investment for a new Acino factory amounts to about 20 million euros ($28.4 million).
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