Swiss stocks climbed for a second day amid optimism Greece will stay in the euro after pro-bailout parties won enough seats in yesterday’s elections to form a government.
Actelion Ltd. led advances, rising 3.6 percent. Swatch Group AG, the world’s biggest watchmaker, climbed 2.3 percent as Berenberg Bank recommended buying its shares. Syngenta AG rose 0.9 percent and Novartis AG added 1.2 percent. Credit Suisse Group AG led bank shares lower.
The Swiss Market Index rose 0.5 percent to 5,938.76 at the close of trading in Zurich, after earlier jumping as much as 0.8 percent. The gauge added 0.7 percent last week amid optimism central banks will take steps to stimulate the global economy. The measure has still dropped 6.4 percent since its 2012 high on March 16. The broader Swiss Performance Index added 0.4 percent today.
“The relief is big at first,” Jan Amrit Poser, chief economist at Bank Sarasin in Zurich, wrote in a report today. “Now the moderate forces have won, which leads many to expect that the requirements of the troika will be met and that Greece is guaranteed to remain in the euro. Even so, all these measures aren’t enough to counter the corrosive uncertainty.”
The so-called troika refers to Greece’s creditors from the European Union, the European Central Bank and the International Monetary Fund.
New Democracy’s Antonis Samaras will begin his second bid in six weeks to form a coalition as New Democracy and the Pasok party won enough seats to form a majority in the 300-member parliament, easing concern that Greece would reject austerity measures needed to qualify for international aid.
Fitch Ratings said New Democracy’s victory removed the immediate risk that the ratings company will cut the credit grades of euro-area countries.
“Fitch will not place all euro-zone sovereigns on rating watch negative as it had indicated would be the case if a Greek euro exit were a probable near-term event,” Fitch said in an e-mailed statement today.
European officials indicated a willingness to ease the terms of rescue loans as long as Greece, with just weeks of cash in the bank, re-commits to their austerity demands. The prospect that Samaras would lose to anti-bailout leader Alexis Tsipras rattled markets concerned that Greece may be forced to leave the 17-nation currency union.
The two-day Group of 20 summit starting today will agree to increase the $430 billion firewall the IMF announced in April, Mexican President Felipe Calderon, the meeting’s host, said on June 16.
Swiss stocks pared earlier gains as Spain’s 10-year government bond yield rose to more than 7 percent, the most since the country started using the euro in 1999.
Actelion, the country’s largest biotechnology company, rose 3.6 percent 38.08 Swiss francs for the biggest gain on the SMI.
Swatch advanced 2.3 percent to 369.60 francs, as Berenberg initiated coverage of the stock with a buy rating and a price estimate of 475 francs.
Cie. Financiere Richemont SA, the owner of the Cartier brand, climbed 1.6 percent to 53.20 francs.
Syngenta, the world’s largest crop-chemical company, gained 0.9 percent to 306.30 francs.
Novartis, Europe’s biggest drugmaker, rose 1.2 percent to 51.60 francs.
Credit Suisse Group AG led bank shares lower, falling 1.5 percent to 17.44 francs.