(Corrects size of Chinese economy in sixth paragraph.)
Transocean added 5.4 percent after the board agreed to a $3-a-share dividend proposal and cost-cutting plan as demanded by billionaire investor Carl Icahn. Novartis rose, contributing the most to the benchmark Swiss Market Index (SMI)’s gain, after selling its blood-transfusion diagnostics unit to Grifols SA for $1.68 billion.
The SMI climbed 0.5 percent to 8,280.2 at the close of trading in Zurich. The gauge advanced 0.2 percent last week as U.S. economic growth and jobs data beat forecasts. The broader Swiss Performance Index also added 0.5 percent today.
“The Swiss market is a bit stronger than Europe today as the SMI profits from company news that supports it,” said Christian Zogg, who manages about $540 million as head of equity and fixed income at LLB Asset Management AG in Vaduz, Liechtenstein. “News out of China remains difficult to interpret at the moment, but data are nevertheless coming in better than expected. Underlying sentiment is still positive and risk on, though the Christmas rally may already be over.”
In China, industrial production jumped 10.3 percent in October from a year earlier, the National Bureau of Statistics said Nov. 9. That was higher than September’s 10.2 percent and exceeded the 10 percent median projection of economists surveyed by Bloomberg. Inflation was a less-than-forecast 3.2 percent.
President Xi Jinping and top Communist Party leaders are gathering in Beijing for a meeting known as the third plenum to outline a blueprint to sustain growth and drive urbanization in the world’s second-biggest economy. The meeting of about 370 top Communist Party members will conclude tomorrow.
Transocean, the world’s largest offshore rig contractor, rose 5.4 percent to 50.95 Swiss francs, the highest price in more than five months, after agreeing at its annual general meeting to support Icahn’s proposal to pay a $3 a share dividend and cut costs. The company also committed to increase margins by $800 million through cost cutting and increased efficiency.
“The announced additional cost-cutting targets should help to increase the cash flows and are a strong sign that management is working hard to create increased shareholder value,” Fabian Haecki, an analyst at Vontobel Holding AG, wrote in a note to clients today.
Novartis (NOVN) added 0.9 percent to 71.55 francs. The drugmaker expects to complete the sale to Grifols, Europe’s largest maker of blood-plasma products, in the first half of next year.
“This first divestiture will fuel hopes of some investors that Novartis will divest more non-core businesses such as animal health, consumer health, the vaccines business and the Roche stake,” David Kaegi, an analyst at J. Safra Sarasin, wrote in a report.
Swiss Re Ltd., the world’s second-largest reinsurer, increased 1.2 percent to 83.70 francs. Bank of America Corp. raised its earnings-per-share estimate for 2013 by 14 percent to 10.73 francs and predicted a possible special dividend payout of $1.5 billion, up from a previous forecast of $1 billion, citing third-quarter earnings strength.
Partners Group Holding AG (PGHN) climbed 2.9 percent to 235.20 francs, its highest prices in two months. Bank of America raised its rating on the money manager to buy from neutral, saying the performance fees it should generate in the coming years and the improving cyclical background provide upside for the stock.
The volume of shares changing hands in SMI-listed companies was 10 percent lower than the average of the last 30 days, according to data compiled by Bloomberg.
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