Cie. Financiere Richemont SA dropped 2.4 percent for the biggest decline on the Swiss Market Index. Holcim Ltd. (HOLN) led construction shares lower. Givaudan SA (GIVN) advanced 1.1 percent after Credit Suisse Group AG upgraded the shares.
The SMI (SMI) retreated 0.9 percent to 7,952.4 at 10:44 a.m. in Zurich, extending its drop this week to 2.7 percent. The benchmark measure has still risen 0.6 percent this month as it headed for its longest streak of gains since 1997. The broader Swiss Performance Index also lost 0.9 percent today.
“We have to get used to much more volatility since the future path of monetary policy is much more uncertain now,” Witold Bahrke, who helps oversee $55 billion as a senior strategist at PFA Pension A/S in Copenhagen, wrote in a message. “The big threat is that the quantitative-easing medicine is withdrawn earlier than expected. As this QE medicine has already caused equities to overshoot relative to fundamentals, earlier than expected tapering means a higher fear factor.”
In the U.S., a report at 9:55 a.m. New York time will probably show that consumer confidence rose to the highest level since July 2007. The Thomson Reuters/University of Michigan gauge of sentiment climbed to 83.7 in May, according to the median projection of economists in a Bloomberg survey. That would match the preliminary reading for this month.
A separate release at 9:45 a.m. may show that business activity in the U.S. stagnated in May. The MNI Chicago Report’s business barometer rose to 50 this month, from 49 in April, economists forecast in a Bloomberg survey. A reading of 50 is the dividing line between expansion and contraction.
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