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Swiss Stocks Fall; Credit Suisse, UBS Lead Benchmark SMI Lower

Sept. 7 (Bloomberg) -- Swiss stocks fell, led by financials, as Credit Suisse Group AG and UBS AG dragged the benchmark Swiss Market Index lower for the first time in five days.

Credit Suisse, Switzerland’s second-biggest bank, slumped 2.3 percent, while UBS, Europe’s largest bank by assets, slipped 1.4 percent. Nestle SA retreated 0.7 percent.

The benchmark Swiss Market Index lost 0.9 percent to 6,360.2 at the 5:30 p.m. close in Zurich, the gauge’s first decline since Aug. 31. Even so, the SMI has risen 7 percent since this year’s low on July 5 as concern abated that efforts by European governments to cut spending may tip their economies into recession. The broader Swiss Performance Index declined 0.9 percent today.

“The markets have come a long way during the past week and many investors are simply looking to take a bit of profit off the table given the unstable macroeconomic world and weak German factory order figures,” Neil Phillips, a fund manager at BlueBay Asset Management Plc in London, which oversees about $38 billion, said today. “Banks are suffering a bit today from the start of Basel III talks and on the concern this could increase pressure on financial shares in the future.”

Stocks extended declines after a report showed German factory orders unexpectedly fell in July as demand in the euro region weakened. Orders, adjusted for seasonal swings and inflation, declined 2.2 percent from June, when they surged a revised 3.6 percent, the Economy Ministry in Berlin said today. That’s the biggest drop since February 2009. Economists forecast a 0.5 percent gain, according to a Bloomberg News survey.

Credit Suisse, UBS

Credit Suisse fell 2.3 percent to 45.38 francs, the stock’s second straight loss, while UBS declined 1.4 percent to 17.82 francs, the stock’s biggest fall since Aug. 25. Zurich Financial Services AG, Switzerland’s largest insurer, retreated 1.3 percent to 233.10 francs, extending yesterday’s 0.4 percent loss. Financial services performed the worst of 19 industries on the Stoxx Europe 600 Index, sliding 1.2 percent.

The Basel Committee on Banking Supervision has started work on new capital and liquidity rules for world leaders to approve when the Group of 20 meets in Seoul in November.

Nestle, which makes up 24 percent of the SMI’s weighting, declined 0.7 percent to 53.80 francs. Nestle Nigeria, the subsidiary of the world’s largest food company operating in Africa’s most populous country, was cut to “sell” from “buy” at Standard Bank Plc.

Swiss Re, Transocean Drop

Swiss Reinsurance Co. slipped 1.6 percent to 43.41 francs, paring four days of advances. The world’s second-largest reinsurer will sell its entire 26 percent stake in India’s TTK Healthcare TPA Pvt. to Vidal Healthcare Services Pvt., Press Trust of India reported, citing a statement from Swiss Re. It failed to disclose the size of the transaction.

Transocean Ltd. retreated 3.3 percent to 54.45 francs, the biggest decline this month. The owner of the oil rig that exploded while drilling BP Plc’s Macondo well in the Gulf of Mexico denied allegations of bullying at its North Sea operations.

MCH Group AG, the organizer of the Art Basel exhibition, soared 9.9 percent to 45.60 francs. It said its expectations for the full year are “clearly above” the previous year.

Petroplus Holdings AG, Europe’s largest independent refiner, advanced 1.9 percent to 12.40 francs, the stock’s third consecutive gain. It was raised to “buy” from “hold” at Deutsche Bank AG.

To contact the reporter on this story: Adam Ewing in Stockholm at aewing5@bloomberg.net.

To contact the editor responsible for this story: David Merritt at dmerritt1@bloomberg.net.

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