Swiss stocks advanced for a third day as pharmaceutical companies climbed and investors weighed data on U.S. durable-goods orders for signs of when the Federal Reserve will begin paring its stimulus program.
Roche Holding AG (ROG) led European health-care stocks higher as Amgen Inc. agreed to buy Onyx Pharmaceuticals Inc. in a $10.4 billion transaction. Meyer Burger Technology AG advanced as Bank J. Safra Sarasin upgraded its recommendation for the supplier of machinery to solar-panel makers. PubliGroupe (PUBN) SA slid after the advertising company posted a loss.
The Swiss Market Index (SMI) added 0.2 percent to 8,022.2 at the close of trading in Zurich. The equity benchmark rose 0.6 percent last week, as measures of manufacturing in the euro area and China increased more than forecast. The gauge has advanced 18 percent so far this year. The broader Swiss Performance Index also gained 0.2 percent today.
“The market is still looking for further hints as to how quickly and consistently the Fed wants to start tapering, so U.S. data remains in focus,” said Martin Schlatter, a fund manager at Swiss Rock Asset Management AG in Zurich, which oversees about $1 billion. “Risk appetite for European stocks still seems intact.”
The volume of shares changing hands in SMI-listed companies was 53 percent lower than the average of the last 30 days, according to data compiled by Bloomberg. Markets in London are closed for a holiday.
In the U.S., orders for durable goods fell in July more than forecast after three months of increases. Bookings for goods meant to last at least three years decreased 7.3 percent, the most since August 2012, after a 3.9 percent gain in June, the Commerce Department said. The median forecast of economists surveyed by Bloomberg called for a 4 percent drop last month.
European Central Bank policy makers can’t rule out cutting the benchmark interest rate from the record low of 0.5 percent even amid signs the euro-area economy is improving, Governing Council Member Panicos Demetriades said in an Aug. 24 interview. By contrast, Bank of Austria Governor Ewald Nowotny said Aug. 22 that he doesn’t see “many arguments now for a rate cut” after the recent “stream of good news.”
Italy’s ruling coalition showed signs of fraying as members of Silvio Berlusconi’s People of Liberty party threatened to topple Prime Minister Enrico Letta’s government if the billionaire media magnate is ousted from the Senate following a tax-fraud conviction.
Deputy Prime Minister and People of Liberty Secretary Angelino Alfano said Aug. 24 after a meeting of Berlusconi allies that voting the former premier out of the Senate would be “unthinkable” and unconstitutional, according to a statement on his website.
Roche, the world’s biggest maker of cancer treatments, rose 0.6 percent to 241.80 Swiss francs. Amgen agreed to buy Onyx to gain access to a rapidly expanding cancer-drug market.
Meyer Burger (MBTN) advanced 0.5 percent to 9.75 francs as Safra Sarasin raised the stock to neutral, the equivalent of hold, from reduce, citing a change in the business environment that could mark the beginning of a new investment cycle.
PubliGroupe slipped 1.4 percent to 88.35 francs after posting a half-year net loss of 9.5 million francs ($10.3 million). The company said last month that it will post a half-year loss and miss a break-even target.
PubliGroupe today also said its media sales unit will adopt a “concise strategy based on more automation, a broader media portfolio approach and variabilisation of costs” under the new Chief Executive Officer Arndt Groth.
“A loss has been pre-announced, but it is worse than expected” Andy Schnyder, an analyst at Vontobel Holding AG, wrote in a note to clients today. “We believe that a new strategy and further job cuts will be not enough to convince investors following the profit warning.”
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