Most Swiss stocks fell, after the country’s equity benchmark yesterday rose to a 13-month high, as Germany’s Finance Ministry said it sees no need to award a banking license to the euro area’s permanent rescue fund.
UBS AG slumped 5.9 percent, its biggest slide since October, after second-quarter profit tumbled and the investment banking unit of Switzerland’s biggest lender posted a loss. Credit Suisse Group AG and Julius Baer Group Ltd. slipped at least 1 percent. Roche Holding AG gained 2.1 percent as Helvea AG upgraded its recommendation for the world’s biggest maker of cancer drugs.
The Swiss Market Index slid 0.1 percent to 6,399.27 at the close in Zurich as more than three stocks dropped for every two that climbed. The gauge posted a 5.5 percent gain in July, its biggest monthly jump in three years, as politicians and European Central Bank President Mario Draghi pledged to preserve the euro. The SMI has rallied 12 percent from this year’s low on June 4. The broader Swiss Performance Index also lost 0.1 percent today.
The volume of shares changing hands in companies listed on the SMI was 7.9 percent lower than the average of the last 30 days, according to data compiled by Bloomberg.
The rules governing the European Stability Mechanism don’t call for the fund to get a banking license so that it can refinance at the European Central Bank, the German Finance Ministry said today in an e-mailed response to a question on a newspaper report. The ministry said it isn’t holding talks on giving a license to the ESM.
Fed Chairman Ben S. Bernanke will probably not announce a third round of large-scale asset purchases this week, and is more likely to wait until September to unveil a plan to buy $600 billion in housing and government debt, according to the median estimates of economists in a Bloomberg News survey.
Eighty-eight percent of economists said the Federal Open Market Committee will refrain from resuming purchases at a two-day meeting beginning today. Forty-eight percent said the FOMC will announce the buying at its Sept. 12-13 meeting, according to the July 25-27 survey of 58 economists.
A Commerce Department report in Washington showed that Americans remained cautious about spending in the final month of the second quarter. Purchases were unchanged after a 0.1 percent decrease in May that was previously reported as unchanged. Economists in a Bloomberg News survey had predicted a 0.1 percent increase. Incomes climbed 0.5 percent, lifting the savings rate to 4.4 percent, its highest in a year.
UBS sank 5.9 percent to 10.29 Swiss francs, posting the biggest drop in a gauge of European lenders. Net income declined to 425 million Swiss francs ($434 million) from 1.02 billion francs a year earlier, the Zurich-based bank said in a statement. That missed the 1.09 billion-franc mean estimate of 11 analysts surveyed by Bloomberg.
The investment bank had a pretax loss of 130 million francs in the second quarter, including a 349 million-franc loss tied to the Facebook Inc. share sale. UBS said it will cut risk-weighted assets at the unit by more than previously planned.
Credit Suisse, the country’s second-largest lender, retreated 1 percent to 16.66 francs. Julius Baer dropped 1.6 percent to 35 francs after Goldman Sachs Group Inc. cut the wealth manager to neutral from buy.
Swatch Group AG, the world’s biggest watchmaker, lost 2.1 percent to 388.70 francs, while Cie. Financiere Richemont SA, the owner of the Cartier and Dunhill brands, decreased 2.7 percent to 55.45 francs.
Roche added 2.1 percent to 173.30 francs after Olav Zilian, an analyst at Helvea, raised the stock to accumulate from neutral, meaning that investors should buy the shares.