Swiss stocks dropped for a fourth day as European Union leaders prepared for this week’s summit in Brussels amid Germany’s continuing opposition to joint euro-area debt sales.
ABB Ltd., the world’s largest power-grid maker, fell 2.8 percent after JPMorgan Chase & Co. cut its recommendation on the shares. UBS AG led banks lower.
The Swiss Market Index declined 0.8 percent to 5,944.48 at the close of trading in Zurich, reducing its advance to 0.1 percent this year. The benchmark measure has still gained 4.1 percent since its 2012 low on June 4 as Greece formed a government after its second election in six weeks. The broader Swiss Performance Index fell 0.8 percent today.
“There have been several meetings, but the market hasn’t seen a big decision to resolve the debt problem,” said Pierre Mouton, a fund manager who helps oversee $7 billion at Notz Stucki & Cie. in Geneva. “Things are in limbo waiting for politicians to act and make a decision.”
Germany faces an increasingly united bloc of euro-area nations demanding more drastic measures to save the currency union. Leaders will attend pre-summit meetings as they work to narrow differences before the June 28-29 gathering.
German Finance Minister Wolfgang Schaeuble said there can’t be any joint euro-area debt “as long as national states decide” on government spending. He made the comment in an interview on ZDF television yesterday.
Billionaire investor George Soros called on Europe to start a fund to buy Italian and Spanish bonds, saying policy makers should create a European Fiscal Authority to purchase the debt in return for the countries implementing achievable budget cuts.
Elsewhere, the Bank for International Settlements said in its annual report released yesterday that central banks are facing the limit of their ability to boost economic growth.
Central banks are being “cornered into prolonging monetary stimulus,” the Basel, Switzerland-based BIS said. “Both conventionally and unconventionally, accommodative monetary policies are palliatives and have their limits.”
ABB lost 2.8 percent to 14.97 Swiss francs. JPMorgan cut its recommendation on the stock to underweight from neutral, meaning investors should reduce their holdings.
UBS, Switzerland’s biggest bank, slid 3 percent to 11.05 francs. Credit Suisse Group AG, the second largest, fell 2.7 percent to 17.46 francs.
Adecco SA, the world’s largest supplier of temporary workers, lost 2.7 percent to 37.30 francs as it fell for a third day.
Sonova Holding AG retreated 1.1 percent to 91.40 francs after a boycott by French and Belgian audiologists of its Phonak and Unitron hearing aids.
The website MesOpinions.com said it has 477 signatures on a petition following Sonova’s disclosure that it bought Audition Sante, a network of independent audiologists. The doctors are concerned that Audition Sante will restrict the choice of brands sold at their centers, the petition said.
The petition is “an unfortunate event for Sonova and tarnishes the company’s reputation,” Simon Goetschmann, an analyst at Helvea AG, wrote in a note to clients.