Dec. 21 (Bloomberg) -- Stocks in Switzerland fell after U.S. House Republican leaders canceled a planned vote on Speaker John Boehner’s plan to raise rates for taxpayers earning more than $1 million.
UBS AG and Credit Suisse Group AG, Switzerland’s largest lenders, dropped more than 2 percent, following a gauge of European banks lower. Swatch Group AG, the world’s biggest maker of Swiss watches, lost 1.1 percent. Holcim Ltd., the world’s largest cement maker, slipped 1 percent.
The Swiss Market Index lost 0.3 percent to 6,889.54 at the close of trading in Zurich, pushing the equity benchmark to a weekly drop of 0.2 percent. The gauge has still rallied 16 percent this year as the European Central Bank unveiled a bond-buying program and the Federal Reserve announced a further round of asset purchases. The broader Swiss Performance Index fell 0.4 percent today.
“I wouldn’t be shocked if this goes past the Jan. 1 deadline by a day or two,” Matt McDonald, a partner at Hamilton Place Strategies LLC, said in a Bloomberg Television interview. “We have the same people around the table that haven’t been able to get a deal done in the past several years. The dynamics of Congress aren’t going to change. What will change is that there will be drastic consequences, probably in terms of markets’ reactions to us going over the cliff, and that will spur some kind of action at the end of the day.”
The volume of shares changing hands today in SMI-listed companies was more than twice the average of the last 30 days, according to data compiled by Bloomberg.
Boehner said Republicans didn’t vote on the tax increases because they lacked sufficient support from his party’s members. A House leadership announcement said the chamber will hold no more votes until after the Christmas holiday and will return “when needed.” More than $600 billion of additional taxes and spending cuts -- known as the fiscal cliff -- will come into force in January if Congress fails to agree on a budget.
The Congressional Budget Office says the U.S. will probably tumble back into a recession without an agreement.
“Now it is up to the president to work with Senator Reid on legislation to avert the fiscal cliff,” Boehner said in a statement. Harry Reid, a Nevada Democrat, is the Senate majority leader.
UBS and Credit Suisse retreated 3 percent to 14.58 Swiss francs and 2.2 percent to 22.56 francs, respectively. A gauge of banks contributed the most to the Stoxx Europe 600 Index’s slide. Julius Baer Group Ltd. lost 3 percent to 32.75 francs.
Swatch decreased 1.1 percent to 461.90 francs.
Holcim slipped 1 percent to 66.90 francs. The company raised 375 million Swiss francs ($409 million) from asset sales in Thailand and Guatemala as Chief Executive Officer Bernard Fontana began the first divestments in a cost-saving program.
Holcim cut its stake in Thailand’s Siam City Cement Pcl to 28 percent from 37 percent and sold a 20 percent stake in Guatemala’s Cementos Progreso SA to majority shareholder Grupo Cemcal SA Progreso.
Panalpina Welttransport Holding AG dropped 3.4 percent to 89.45 francs, its biggest slide in more than six weeks, after predicting a goodwill impairment of 29 million francs on Grieg Logistics AS, which it acquired in 2011. The company said it will record the impairment in 2012.
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