June 20 (Bloomberg) -- Swiss stocks declined, snapping three days of gains, as a gauge of investor confidence dropped to the lowest level in five months.
Nestle SA slid 1 percent, making the biggest contribution to the Swiss Market Index’s retreat. Swisscom AG also decreased 1 percent. Swiss Life Holding AG jumped 6.1 percent after the shares were upgraded at UBS AG.
The SMI fell 0.3 percent to 6,017.91 at the close in Zurich. The gauge surged 1.6 percent yesterday amid speculation that Greece’s political parties would form a coalition government with a workable majority. The broader Swiss Performance Index decreased 0.1 percent today.
The volume of shares changing hands in SMI-listed companies was 29 percent lower than the average of the last 30 days, according to data compiled by Bloomberg.
Swiss investor confidence fell to the lowest level in five months in June, indicating the economy will deteriorate. A measure of investor and analyst expectations that aims to predict economic developments six months in advance plunged to minus 43.4 in June, the ZEW Center for European Economic Research in Mannheim, Germany, and Zurich-based Credit Suisse Group AG said in a statement. That was the lowest since January.
In the U.S., the Federal Reserve will expand Operation Twist beyond $400 billion to spur growth and buy protection against a worsening sovereign-debt crisis in Europe, according to a Bloomberg News survey of economists.
Fifty-eight percent of respondents in a June 18 poll said the Fed will prolong the program, which seeks to lower borrowing costs by extending the average maturity of the securities in the central bank’s portfolio. The current plan ends this month.
The Federal Open Market Committee ends its two-day meeting today with a statement scheduled for release at 12:30 p.m. in Washington. Sixty percent of the economists surveyed said the Fed probably won’t start a third round of large-scale bond purchases, also known as quantitative easing.
Greece’s political parties struck an agreement to form a coalition government. New Democracy, which won the June 17 election with almost 30 percent of the vote, Pasok and the Democratic Left will hold a combined 179 seats in the 300-member parliament. New Democracy’s leader, Antonis Samaras, was sworn in as the prime minister.
Nestle, the maker of Nespresso coffee and KitKats, fell 1 percent to 55.40 Swiss francs. Morgan Stanley removed the stock from the list of its best ideas.
Swisscom, Switzerland’s biggest phone company, declined 1 percent to 372.10 francs.
Julius Baer Group Ltd, the Swiss wealth manager established in 1890, dropped 0.9 percent to 32.93 francs.
Adecco SA, the world’s largest supplier of temporary workers, rose 2.2 percent to 40.33 francs.
Swiss Life, Switzerland’s largest life insurer, surged 6.1 percent to 87.95 francs. The stock was raised to buy from sell at UBS.
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