Swiss Stocks Drop on Italian Government Confidence Vote
Sept. 30 (Bloomberg) --Swiss stocks declined, after the benchmark Swiss Market Index posted a weekly loss, as Italian Prime Minister Enrico Letta fought to save his administration and the U.S. faced its first government shutdown in 17 years.
Syngenta AG (SYNN) slid 2.7 percent after Citigroup Inc. lowered its recommendation on the world’s largest maker of crop chemicals. Clariant AG (CLN) slipped 0.9 percent as it acquired the organic pigment business of Jiangsu Multicolor Fine Chemical Co. Aryzta AG (ARYN) rose 3.1 percent as the owner of bakery businesses reported full-year revenue that beat analysts’ estimates.
The SMI (SMI) fell 0.7 percent to 8,000.21 at 9:56 a.m. in Zurich. The equity benchmark has still climbed 3.3 percent in September, extending its gain this quarter to 4.1 percent, as the Federal Reserve refrained from reducing its monthly bond purchases. It has rallied 17 percent so far in 2013, the third-best performance by a European developed market. The broader Swiss Performance Index also slipped 0.7 percent today.
The volume of shares changing hands in SMI-listed companies today was 12 percent lower than the average of the past 30 days, according to data compiled by Bloomberg.
In Italy, Letta said he will request a confidence vote for Oct. 2 to try to save his five-month-old administration after Silvio Berlusconi withdrew his support from the ruling coalition and pulled his ministers from the cabinet.
The U.S. government faces its first partial shutdown since 1996 at midnight tonight after a weekend without negotiations or compromise from either the House or Senate to avert it.
The House of Representatives voted 231-192 yesterday to tie funding for the federal government to clauses that remove many of the Affordable Care Act’s central provisions for one year. Should the Senate reject the bill today, the government may shut down from tomorrow.
That would reduce fourth-quarter economic growth by as much as an annualized 1.4 percentage points, depending on its length, according to economists. The Congressional Research Office estimated that the shutdown from 1995 to 1996 cost the government $1.4 billion.
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