Swiss stocks (SMI) climbed, posting their biggest weekly rally since July 2009, after a U.S. report showed the unemployment rate in the world’s largest economy unexpectedly fell in November.
Nobel Biocare AG, the world’s second-biggest maker of dental implants, rose 3.1 percent. UBS AG (UBSN) and Credit Suisse Group AG (CSGN), Switzerland’s biggest banks, climbed more than 3.5 percent. Temenos Group AG (TEMN), the banking-software maker, gained 6.1 percent after striking a partnership with International Business Machines Corp.
The Swiss Market Index, a measure of the biggest and most actively traded companies, advanced 0.7 percent to 5,718.85 at the close in Zurich. The gauge rallied 6 percent this week, its largest increase in more than two years. The broader Swiss Performance Index also climbed 0.7 percent today.
“The numbers were good and there is optimism about the U.S. recovery,” said John Plassard, director at Louis Capital Markets in Geneva.
Unemployment in the U.S. dropped to 8.6 percent in November, the lowest since March 2009, from 9 percent, Labor Department figures showed today in Washington. Payrolls climbed 120,000 last month after a revised 100,000 increase in October. The median estimate in a Bloomberg News had called for a gain of 125,000 and for the jobless rate to remain at 9 percent.
“The payrolls figures were weaker” than economists had predicted, Plassard said. “If there’s less job creation, one must think about the fact that offers are shrinking and that the better unemployment rate we see now might be a reflection of people who are retiring or who are no longer entitled to unemployment benefits.”
German Chancellor Angela Merkel repeated her wish to rework European Union rules to lock in budget monitoring and seal off the European Central Bank from political interference, as part of measures to contain the region’s debt crisis.
French President Nicolas Sarkozy late yesterday called for “more discipline” and automatic penalties for nations that break fiscal rules.
“There seems to be some movement coming to the political arena in Europe,” said Reto Huenerwadel, a senior economist at UBS in Zurich. “There’s hope that Germany and France will make clear steps toward each other.”
Nobel Biocare gained 3.1 percent to 11.82 Swiss francs, its highest price since Aug. 11, after UBS estimated that the company is worth 15.70 francs apiece as a leveraged-buyout target. At that price, a private-equity investor can expect a 22.1 percent internal rate of return, UBS said citing a proprietary LBO model.
UBS and Credit Suisse, Switzerland’s biggest banks, climbed 3.6 percent to 11.36 francs and 5.7 percent to 22.87 francs, respectively, as a gauge of European banks was the best performer of the 19 industry groups in the Stoxx Europe 600 Index. Julius Baer Group Ltd. (BAER), the 121-year-old wealth manager, rose 3.1 percent to 34.15 francs.
Temenos increased 6.1 percent to 15.60 francs. The company late yesterday said it agreed on a deal with International Business Machines Corp. in which IBM will offer “consulting and integration services together with software and hardware resources for Temenos implementations.”
“This agreement with IBM serves as an important seal of approval for Temenos’s products,” Panagiotis Spiliopoulos, an analyst at Vontobel Holding AG, wrote in a note to clients today. “A stronger emphasis on the partner model should help improve Temenos’s cash-flow metrics.”
Transocean Ltd. (RIG), the world’s largest provider of offshore oil rigs, rallied 4 percent to 40.55 francs, its biggest rally in six weeks, as crude headed for its first weekly gain in three.
Cie. Financiere Richemont SA, the maker of Jaeger-LeCoultre watches, added 1.9 percent to 49.80 francs. The company’s Panerai and Cartier brands may hire more employees in Switzerland, Le Temps reported. Separately, HSBC Holdings Plc added Richemont to its “Europe Super Ten Portfolio.”
Zurich Financial Services AG (ZURN), Switzerland’s largest insurer, rise 1.7 percent to 206.20 francs after Goldman Sachs Group Inc. recommended buying the shares, saying the company is “firmly on track” to deliver on the targets it announced in December 2010. Goldman reiterated its “conviction buy” rating.
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