Stocks in Switzerland Advance as Roche Shares Lead Gains

Stocks in Switzerland climbed for the first time in four days, led by pharmaceutical companies, as German manufacturing and services growth topped forecasts.

Roche (ROG) Holding AG, the world’s biggest maker of cancer drugs, gained 1.3 percent. Syngenta (SYNN) AG, the largest maker of crop chemicals, slid 3.8 percent after posting first-half earnings and revenue that missed analyst estimates. Sulzer AG fell 3.7 percent as Vontobel Holding AG downgraded its recommendation for the shares.

The Swiss Market Index (SMI) increased 0.4 percent to 7,928.17 at 9:58 a.m. in Zurich. The equity benchmark has risen 16 percent so far this year. The broader Swiss Performance Index advanced 0.3 percent today.

The number of shares trading hands in SMI-listed companies was 31 percent lower than the average of the past 30 days, data compiled by Bloomberg show.

A gauge of German manufacturing increased to 50.3 this month from 48.6 in June, where a number greater than 50 indicates expansion, according to Markit Economics. Economists in a Bloomberg survey had predicted a reading of 49.2. Services growth in Europe’s biggest economy also topped projections.

In China, a preliminary private survey showed manufacturing contracted more than estimated this month. The reading of 47.7 for an index released by HSBC Holdings Plc and Markit was less than estimated and, if confirmed in the final report Aug. 1, would be the lowest in 11 months.

Home Sales

U.S. Commerce Department data may show purchases of new homes increased to a 484,000 pace last month, the highest level since June 2008, according to the median forecast of 77 economists in a Bloomberg News survey.

Roche advanced 1.3 percent to 234.20 Swiss francs, contributing the most to the SMI’s gain. The company said obinutuzumab, treatment developed by its Genentech unit, delayed progression of one of the most common types of blood cancer in a phase III study, adding it was a better treatment than rituxan against previously untreated chronic lymphocytic leukemia.

A gauge of health-care companies was the best performer of the 19 industry groups in the Stoxx Europe 600 Index, with Novartis AG (NOVN) gaining 1 percent to 68.50 francs and Lonza Group AG climbing 1.1 percent to 75.25 francs.

Swatch Group AG, the largest maker of Swiss watches, advanced 1.9 percent to 548.50 francs, posting the best performance on the SMI.

Syngenta declined 3.8 percent to 371.90 francs as it reported a drop in first-half profit after cold weather and late northern-hemisphere crop planting weighed on demand for fungicides. Net income fell 5 percent to $1.41 billion, compared with the average analyst projection of $1.49 billion.

‘Negative View’

“Syngenta’s first-half results were weak and disappointing at all levels,” Philipp Gamper, an analyst at Bank Sarasin & Cie. in Zurich, wrote in a report today. “On the back of this currently unfavorable situation we keep our distinct negative view on Syngenta. Moreover, the valuation of Syngenta’s stock is stretched, and the market expectations remain ambitious.”

Sulzer (SUN) retreated 3.7 percent to 137.30 francs, for the largest four-day drop since October 2008, as Vontobel cut the stock to hold from buy and HSBC Holdings Plc downgraded the company to underweight from neutral. The shares slumped yesterday after the pumpmaker cut its full-year forecast.

“The uncertainties regarding more restructuring costs, impairments and guidance miss stay high in the second half,” Fabian Haecki, an analyst at Vontobel, wrote in a note to clients today.

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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