Swiss Stocks Drop, Trimming Monthly Gain; Clariant Slides

Stocks in Switzerland fell, trimming the Swiss Market Index’s second straight monthly gain, as a worse-than-expected report on U.S. business activity overshadowed a rally in insurers.

Clariant AG (CLN) tumbled 8 percent, the most in 13 months, after lowering its full-year sales forecast. Nestle SA (NESN), which accounts for 24 percent of the SMI by weight, retreated 0.9 percent. Swiss Re Ltd. and Zurich Insurance Group AG advanced in the aftermath of Hurricane Sandy.

The benchmark SMI fell 0.6 percent to 6,595.13 at the close of trading in Zurich, reducing the October advance to 1.5 percent. The gauge has rallied 15 percent from this year’s low on June 4 as European Central Bank policy makers agreed on an unlimited bond-buying plan and the Federal Reserve announced a third round of quantitative easing. The Swiss Performance Index also declined 0.6 percent today.

“As the New York storm passes, liquidity returns to give a clearer picture of the market, but poor sentiment to earnings and manufacturing data continue,” said Daniel Weston, chief investment officer at Aimed Capital Management LLC in Munich. “Euro insurers are rallying because their exposure to East Coast damage isn’t as big as was thought.”

The New York Stock Exchange opened today for the first time this week after Hurricane Sandy caused U.S. markets to close for two straight days.

Economic Data

U.S. business activity unexpectedly contracted in October for a second month, adding to signs manufacturing has retreated from its central role in the economic recovery. A gauge from the Institute for Supply Management-Chicago Inc. rose to 49.9 from 49.7 in September. A reading of 50 is the dividing line between expansion and contraction.

The euro-area jobless rate climbed to a record in September as the fiscal crisis and tougher austerity measures threatened to deepen the economy’s slump. Unemployment rose to 11.6 percent from 11.5 percent in August, the European Union’s statistics office in Luxembourg said.

Euro-area governments urged Greece to make deeper spending cuts to receive further aid, after the region’s finance ministers held a conference call today.

“We called on the Greek authorities to solve remaining issues so as to swiftly finalize the negotiations,” Luxembourg Prime Minister Jean-Claude Juncker said in an e-mailed statement. The aim is to “conclude on the program” at a scheduled Nov. 12 meeting of the ministers in Brussels, he said.

Volume Rises

The volume of shares changing hands in SMI-listed companies was 32 percent higher than the 30-day average, according to data compiled by Bloomberg.

Clariant plunged 8 percent to 9.97 Swiss francs after saying it sees unchanged sales in local currencies this year, compared with a July 25 forecast for sales growth and sustained profitability.

Nestle slid 0.9 percent to 59.10 francs, the lowest level in six weeks.

Transocean Ltd., the world’s biggest offshore driller, slid 2.5 percent to 42.39 francs for the biggest decline in the SMI. (SMI) The shares dropped as much as 2.7 percent in New York trading as markets reopened after Hurricane Sandy.

Swiss Re, the world’s second-biggest reinsurer, added 0.6 percent to 64.35 francs and Zurich Insurance climbed 0.3 percent to 229.50 francs. A gauge of insurers was the best performing group in the Stoxx Europe 600 Index.

Newron Pharmaceuticals SpA (NWRN) jumped 13 percent to 8.44 francs after the company resubmitted an offer to buy NeuroNova AB for 15.5 million euros ($20.2 million). Newron’s shareholders rejected plans to acquire the Swedish company on Sept. 19, with 66.32 percent voting in favor of the deal compared with the 66.67 percent majority needed for approval.

To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net

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

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