Swiss stocks climbed for a second day as Italy joined Greece in appointing a new prime minister in an attempt to control the euro-area debt crisis.
The nation’s watchmakers paced gains, with Swatch Group AG (UHR) and Cie. Financiere Richemont SA adding at least 1 percent. Swiss Life Holding AG (SLHN), Switzerland’s largest life insurer, dropped 1.2 percent. Mobimo Holding AG (MOBN), a Swiss real estate company, fell 2 percent.
The Swiss Market Index (SMI), a measure of the largest and most actively traded companies, rose 0.2 percent to 5,661.71 at the close in Zurich, after swinging between gains and losses more than 20 times. The gauge has rebounded 18 percent from this year’s low on Aug. 10 as policy makers increased their efforts to resolve the European fiscal crisis. The Swiss Performance Index added 0.1 percent today.
“With the leadership changes in both troubled countries we definitely bought some time,” said Konstantin Giantiroglou, head of investment advisory at Neue Aargauer Bank in Brugg, Switzerland. “But investors are still cautious because they want to see implementation of the reforms and further steps that are necessary in order for Italy to regain trust in the market.”
Mario Monti, a former European Union competition commissioner, was appointed as Italy’s prime minister and will lead a new government, boosting confidence in the country’s ability to cut the euro region’s second-biggest debt.
Silvio Berlusconi resigned on Nov. 12 after the parliament in Rome gave final approval to a package of measures to spur growth and cut debt. Berlusconi stepped down as defections ended Berlusconi’s parliamentary majority and the country’s 10-year bond yield surged over the 7 percent threshold that prompted Greece, Ireland and Portugal to seek EU bailouts.
Italy sold 3 billion euros ($4 billion) of five-year bonds today at the highest yield in more than 14 years. The Treasury sold the debt to yield 6.29 percent, up from 5.32 percent at the last auction on Oct. 13. Demand was 1.47 times the amount on offer, compared with 1.34 times last month.
In Greece, the nation’s finance minister, Evangelos Venizelos, said his priority is to ensure the country gets a sixth loan under an EU-led bailout after Prime Minister Lucas Papademos took charge of a new interim government. He added the country must grasp the opportunity presented by the change of administration.
Swiss producer and import prices dropped for a sixth month in October from a year earlier, as the franc’s strength lowered the cost of goods from abroad. Prices for products ranging from factory to farm goods as well as imports declined 1.8 percent from a year earlier, according to the Federal Statistics Office in Neuchatel, Switzerland. In the month, prices fell 0.2 percent. Costs of imports slipped 0.5 percent from September and 1.8 percent from a year earlier.
Swatch, the world’s biggest watchmaker, advanced 1 percent to 370.70 Swiss francs and Richemont, the owner of the Cartier brand, rose 2.4 percent to 49.87 francs.
Actelion Ltd. (ATLN), Switzerland’s largest biotechnology company, added 1.5 percent to 32 francs, a second day of gains.
Banks and insurers were among the worst performers in the SMI, with Swiss Life sliding 1.2 percent to 99.30 francs.
Mobimo fell 2 percent to 216.40 francs, the biggest retreat in two months, as the company said it plans to raise as much as 200 million francs ($221 million) in a capital increase.
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