Swiss stocks fell the most in three weeks after Federal Reserve Bank of Philadelphia President Charles Plosser said the latest round of quantitative easing may not boost growth or hiring in the world’s largest economy.
Myriad Group AG (MYRN) plunged to the lowest price on record after the software developer reported a wider first-half loss and unveiled a rights offer. Dufry AG, the operator of Hudson News stores in airports, lost 7.9 percent after UBS AG (UBSN) lowered its recommendation for the stock.
The Swiss Market Index dropped 1.1 percent to 6,540.41 at the close in Zurich, after rising yesterday to the highest since March 1, 2011. The gauge has still rallied 14 percent from this year’s low on June 4 as the Fed and European Central Bank started bond-buying programs. The broader Swiss Performance Index also slipped 1.1 percent today.
“Sentiment in equity markets is deteriorating somewhat after all major central banks have delivered on their promises and done their part,” said Alessandro Fezzi, senior market analyst at LGT Capital Management AG in Pfaeffikon, Switzerland. “I think markets have entered a consolidation phase and it will need better-than-expected economic data to support the stock market.”
Plosser said late yesterday that new bond buying announced by the Fed this month probably won’t boost growth or hiring and may jeopardize the central bank’s credibility.
The Federal Open Market Committee said on Sept. 13 that it will undertake a third round of quantitative easing by purchasing mortgage-backed securities at a pace of $40 billion per month until labor markets “improve substantially.”
In Spain, Prime Minister Mariano Rajoy has struggled to persuade people to accept the deepest austerity measures on record. Unions and protest groups, spurred by the Portuguese government’s decision to drop a planned tax increase following demonstrations, have demanded a referendum on Rajoy’s cuts.
Economy Minister Luis de Guindos will present additional measures tomorrow that the European Commission requires as part of efforts to bring down Spain’s borrowing costs. Budget Minister Cristobal Montoro will unveil the 2013 budget.
Myriad plunged 14 percent to 2.09 Swiss francs, its lowest price since selling shares to the public in September 2005. The company reported a first-half net loss of $23.3 million, compared with a net loss of $4.6 million a year earlier. Myriad said it will raise 10 million francs ($10.7 million) in a fully underwritten rights issue. The company also said Chief Executive Officer Simon Wilkinson resigned.
Dufry (DUFN) tumbled 7.9 percent to 111.9 francs, its largest decline since September 2011. UBS downgraded the shares of the operator of duty-free shops to neutral from buy.
UBS slid 4.3 percent to 11.55 francs, contributing the most to the SMI’s loss.
Credit Suisse Group AG (CSGN), Switzerland’s second-largest lender, tumbled 4.2 percent to 20.20 francs, the deepest slump since June 14. The bank is considering combining its asset-management unit with the private and investment-banking divisions, according to a person familiar with the matter.
Georg Fischer AG (FI/N) retreated 2.1 percent to 340.5 francs. Torsten Wyss, an analyst at UBS, cut his price estimate for Europe’s biggest maker of iron castings for cars by 8 percent to 460 francs.
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