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Stocks in Switzerland Rise on U.S. Jobs Data

Updated on

Aug. 3 (Bloomberg) -- Stocks in Switzerland rose for a second day, with the benchmark Swiss Market Index completing its third week of gains, after a report showed that U.S. payrolls climbed more than forecast in July.

OC Oerlikon Corp AG, the world’s largest maker of textile machinery, added 0.9 percent after saying its profit margin will increase this year. Givaudan SA, the biggest manufacturer of flavors and fragrances, declined 3.6 percent as first-half earnings missed analysts’ projections.

The SMI advanced 0.9 percent to 6,461.54 at the close in Zurich, finishing a weekly rally of 1.6 percent. The gauge has jumped 13 percent since its 2012 low on June 4 as policy makers eased repayment terms for Spanish lenders and central banks took steps to boost economic growth. The broader Swiss Performance Index rose 0.9 percent today.

“In the current environment, the world is flying only on one engine and this engine is the U.S. economy,” said Didier Duret, who helps manage about $200 billion as chief investment officer at ABN Amro Private Banking. “That’s why it is so important to look at these numbers coming out from the U.S.,” he said in a Bloomberg TV interview with Maryam Nemazee.

The volume of shares changing hands on SMI companies today was 2.2 percent above the average of the past 30 days, data compiled by Bloomberg showed.

Unemployment Rate

In the U.S., payrolls increased 163,000 last month, following a revised 64,000 jump in June that was less than initially reported, Labor Department figures showed. The median estimate of 89 economists surveyed by Bloomberg News called for a gain of 100,000. Unemployment rose to 8.3 percent.

The Federal Reserve has repeatedly said it will take additional steps “if needed” to support the economy.

European Central Bank President Mario Draghi yesterday said the ECB is working on a plan to re-enter bond markets and that new purchases in the secondary market would only complement buying by the European Union’s rescue fund in the primary market, to which strict conditionality is attached.

Oerlikon advanced 0.9 percent to 7.99 francs. Earnings before interest and taxes, excluding a one-time gain from the disposal of property at the textiles unit, will increase by half a percentage point to about 11.5 percent of sales this year, Chief Executive Officer Michael Buscher said.

UBS AG and Credit Suisse Group AG, Switzerland’s largest lenders, rose 3.6 percent to 10.50 francs and 4.6 percent to 16.74 francs, respectively. A gauge of bank shares was the best performer on the Stoxx 600 Europe Index, gaining 5.1 percent.

Adecco SA, the largest supplier of temporary workers, rose 4.5 percent to 44.15 francs.

Givaudan tumbled 3.6 percent to 920 francs, the biggest slide since Aug. 10. First-half earnings before interest, taxes, depreciation and amortization of 428 million francs ($435 million) missed the average analyst estimate of 451.7 million francs.

To contact the reporter on this story: Tom Stoukas in Athens at astoukas@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net

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