Swiss Stocks Drop; Swiss Life, Julius Baer Shares Retreat

Swiss stocks retreated, snapping eight days of gains for the Swiss Market Index, as financial shares declined, outweighing optimism that the recovery in the world’s largest economy is strengthening.

Swiss Life Holding AG, Switzerland’s biggest life insurer, slipped after Goldman Sachs Group Inc. recommended selling the shares. Julius Baer Group Ltd. (BAER) dropped 2.1 percent as it said Raymond J. Baer won’t stand for re-election to the board. Logitech SA, the world’s largest maker of computer mice, climbed 2.8 percent.

The SMI (SMI) slid 0.2 percent to 6,326.56 at the close in Zurich. The gauge climbed 2.5 percent last week, its biggest gain since December. The SMI has rallied 6.6 percent this year as the European Central Bank disbursed more than 1 trillion euros ($1.3 trillion) to the region’s lenders. The broader Swiss Performance Index also lost 0.2 percent today.

“After the strong advances we saw last week, we expect the markets to calm down,” said Peter Buergler, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland. “But this doesn’t necessarily mean that the markets will collapse. However, the air has become rather thin and the squeezing price increases could be over for now.”

The number of shares changing hands on the SMI today was 17 percent lower than the 30-day average, according to data compiled by Bloomberg.

‘Strong Start’

“With global equities having gotten off to a strong start to 2012, market participants now seem evenly divided as to the near-term outlook for stocks,” said Cameron Peacock, a market analyst at IG Markets in Melbourne. “Equally compelling cases could be made for the rally continuing, or a modest pullback in the vicinity of 5 percent to 10 percent. What seems more certain is that policy expectations and subsequent responses from central banks will be key drivers of market sentiment and direction.”

Swiss Life (SLHN) declined 0.6 percent to 114.20 Swiss francs after Goldman Sachs cut the stock to sell from neutral.

Julius Baer retreated 2.1 percent to 36.75 francs for the worst performance in the SMI. Raymond J. Baer will step down to oversee the bank’s response to a U.S. tax investigation, leaving the board without a member of the family for the first time since the Baers founded the company in 1890. Baer will become honorary chairman on April 11 and will head a committee handling the bank’s dealings with the U.S. authorities. The board will nominate Daniel Sauter for the post of non-executive chairman next month.

Swiss Re, Transocean

Swiss Re Ltd., the world’s second-biggest reinsurer, dropped 1.2 percent to 58.45 francs. Daniel Bischof, an analyst at Helvea AG, downgraded the company’s shares to neutral, the equivalent of hold, from accumulate, which is the equivalent of buy.

Transocean Ltd. (RIG), the world’s largest operator of offshore drilling rigs, slipped 1.9 percent to 52.90 francs. A Brazilian prosecutor will file charges by March 22 for “environmental crimes” following an oil spill off the coast of Brazil involving Chevron Corp. Transocean owned the drilling rig at Brazil’s Frade field. It leaked in November.

Logitech climbed 2.8 percent to 7.27 francs as a gauge of European technology companies was among the best performers of the 19 industry groups in the Stoxx Europe 600 Index (SXXP).

Health-care shares pushed the SMI higher, with Novartis AG (NOVN) and Sonova Holding AG (SOON) gaining 0.7 percent to 50.50 francs and 1.9 percent to 99.85 francs, respectively. Actelion Ltd. (ATLN), Switzerland’s largest biotechnology company, added 1.3 percent to 36 francs.

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

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

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