Swiss Stocks Climb as ECB Holds Interest Rate

Swiss stocks advanced as the European Central Bank left its benchmark interest rate at a historic low, amid speculation on the timing of a Spanish bailout.

Swiss Re Ltd. rose 2.1 percent, leading a gauge of European insurance companies higher. Nobel Biocare Holding AG slumped 4.3 percent after the world’s second-largest maker of dental implants cut its profit forecast.

The Swiss Market Index (SMI) gained 0.4 percent to 6,631.35 in Zurich. The benchmark gauge has rallied 16 percent from this year’s low on June 4 as ECB policy makers agreed on an unlimited asset-purchase program and the Federal Reserve announced a third round of quantitative easing. The broader Swiss Performance Index added 0.3 percent today.

“In the short-term, Spain will certainly remain in focus,” said Serge Berger, a Zurich-based trader at Blue Oak Advisors LLC. “What keeps sentiment afloat is continued central-bank stimulus; it’s all structural now.”

The ECB kept interest rates on hold today as President Mario Draghi waits for Spain to decide if it needs his help.

Policy makers meeting in Ljubljana, Slovenia, left the benchmark interest rate at 0.75 percent, as predicted by 48 of 52 economists in a Bloomberg News survey. Four forecast a cut to 0.5 percent. Draghi speaks to reporters 2:30 p.m. local time.

Spanish Auction

The SMI briefly pared gains after Spain’s three-year borrowing costs rose at a debt auction. The nation sold 3.99 billion euros ($5.2 billion) of securities, compared with a maximum target of 4 billion euros, the Bank of Spain said.

In the U.S., a Commerce Department report showed that orders placed with factories fell 5.2 percent, the biggest decrease since January 2009. The median forecast of economists in a Bloomberg News survey called for a decline of 5.9 percent.

A gauge of European insurers advanced for the first time in three days. Swiss Re, the world’s second-largest reinsurer, gained 2.1 percent to 65.40 Swiss francs. Baloise Holding AG (BALN) rose 1.3 percent to 76.90 francs.

Nobel Biocare

Nobel Biocare tumbled 4.3 percent to 9.03 francs for the sharpest decline since June 25, after cutting its profit forecast. Earnings before interest and taxes will probably be 67 million euros to 70 million euros this year as revenue declines by a “modest” single-digit percentage at constant exchange rates, the company said in a statement today. Nobel Biocare said in August that full-year Ebit would be near the level of last year, which was 76.6 million euros, excluding certain items.

“As visibility towards an improvement of the Japanese market is low and the uncertainties in Europe remain, we advise investors to remain on the sidelines,” Carla Baenziger, an analyst at Vontobel Holding AG, wrote in a note to clients today.

Straumann Holding AG (STMN), the world’s largest maker of dental implants, slid 3.3 percent to 119.9 francs.

Syngenta AG (SYNN) retreated 1.3 percent to 348.30 francs after peer Monsanto Co.’s fiscal 2013 earnings forecast trailed analysts’ estimates.

Julius Baer Group Ltd. (BAER) declined 1.4 percent to 32.33 francs after Equita SIM SpA initiated coverage of the stock with a reduce rating, meaning investors should sell the company’s shares.

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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