House Passes Budget to Ease $63 Billion in U.S. Spending Cuts
Swiss Stocks Rise to 4 1/2-Year High on China, U.S. Data
Swiss stocks climbed to a 4 1/2-year high as Chinese manufacturing expanded, American jobless claims fell to a five-year low and the House of Representatives voted to temporarily suspend the U.S. government’s borrowing limit.
UBS AG (UBSN) and Roche Holding AG (ROG) paced gains in the Swiss Market Index, rising more than 1.5 percent. Logitech International (LOGN) SA, the world’s largest maker of computer mice, plunged 9.6 percent after reporting an unexpected loss. Lonza Group AG retreated 2.8 percent as its earnings forecast missed analyst projections.
The SMI (SMI) increased 0.9 percent to 7,457.74 at the close of trading in Zurich, the highest level since June 5, 2008. The broader Swiss Performance Index increased 0.8 percent to the highest since December 2007.
The U.S. House approved legislation to suspend the $16.4 trillion borrowing limit until May 19 late yesterday. The measure now goes to the Senate, where Majority Leader Harry Reid said lawmakers will pass the bill unchanged and send it to President Barack Obama.
“It’s a threat that’s pushed farther away,” said Pierre Mouton, who helps oversee $6 billion as a fund manager at Notz Stucki & Cie. in Geneva. “This gives lawmakers more time.”
The SMI has rallied 9.3 percent in 2013, the best start to a year since the index was formed in 1988, after U.S. lawmakers agreed on a compromise budget. The volume of shares changing hands in SMI-listed companies was 25 percent greater than the 30-day average today, data compiled by Bloomberg show.
China’s manufacturing is expanding at the fastest rate in two years, according to a private survey of companies. The preliminary reading of a Purchasing Managers’ Index was 51.9 in January, according to a statement from HSBC Holdings Plc and Markit Economics today. That compared with the 51.5 final reading for December and the 51.7 median estimate of 17 analysts surveyed by Bloomberg News.
Claims for jobless benefits in the U.S. unexpectedly dropped last week to a five-year low. Applications for unemployment insurance payments decreased by 5,000 to 330,000 in the week ended Jan. 19, the Labor Department reported today.
The Conference Board’s index of the U.S. economic outlook increased 0.5 percent in December, the New York-based group said today. Economists had projected the gauge would rise 0.4 percent, according to the median estimate in a Bloomberg survey.
UBS, Switzerland’s biggest bank, rallied 2.5 percent to 16.25 Swiss francs. Credit Suisse Group AG (CSGN), the second-largest, rose 4 percent to 27.36 francs. Both stocks are at the highest since July 2011.
Roche, a maker of cancer drugs, climbed 1.6 percent to 204.50 francs after the U.S. Food and Drug Administration approved the company’s Avastin for use with chemotherapy in the treatment of colorectal cancer. That’s the highest level since February 2008.
Interroll Holding AG (INRN) advanced 3.6 percent to 385 francs as the maker of conveyor belts said full-year net income is likely to grow by about 5 percent to 10 percent.
Logitech sank 9.6 percent to 6.51 francs, the largest retreat in three months, as it started selling its remote- control and video security businesses after posting a third- quarter loss of $195 million.
Yesterday, the company took a $211 million non-cash impairment charge on its video conferencing unit. Before that statement, Logitech was estimated to report third-quarter net income of $50.3 million, according to the average of seven analysts surveyed by Bloomberg.
Lonza (LONN) slid 2.8 percent to 53.75 francs, the biggest decline since Oct. 5. Chief Executive Officer Richard Ridinger said a review of the drug-ingredient maker may result in disposals, factory mergers and management changes. He forecast growth in earnings before interest and taxes of about 10 percent this year to 369 million francs ($396 million), compared with the 413 million-franc average analyst estimate in a Bloomberg survey.
Acino Holding AG (ACIN) sank 5.3 percent to 98 francs, the largest drop since September 2011. The drug company said the 2012 margin for earnings before interest, taxes, depreciation and amortization will miss its forecast. Postponed product deliveries due to customer destocking and pricing pressure in established markets hurt profitability, Acino said in a statement.
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