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Swiss Stocks Extend Five-Year High as Novartis Gains

March 15 (Bloomberg) -- Swiss stocks rose for a second day, extending a five-year high, as drugmakers climbed and U.S. industrial production topped forecasts.

Novartis AG increased as JPMorgan Chase & Co. recommended the shares and the U.S. Food & Drug Administration designated an experimental lung cancer treatment as a Breakthrough Therapy. Roche Holding AG advanced 0.7 percent. Daetwyler Holding AG extended a two-decade high as the engineering company reported a jump in profit. Dufry AG climbed for the first time in eight days after earnings increased.

The Swiss Market Index rose 0.3 percent to 7,864.39 at the close in Zurich, after earlier falling as much as 0.2 percent. The gauge has climbed 1.5 percent this week, reaching the highest level since January 2008, as data pointed to a strengthening global economy and speculation grew that central banks will maintain support. The broader Swiss Performance Index also added 0.3 percent today.

“Central bank stimulus will continue to drive markets,” Angus Campbell, head of market analysis at Capital Spreads in London, said in a phone interview. “Over the medium term, the uptrend for equity markets remains intact from a technical perspective.”

The number of shares changing hands in companies on the SMI was 91 percent greater than the average of the past 30 days, as options expired, according to Bloomberg data.

U.S. Economy

U.S. industrial production rose more than forecast in February as factories turned out more business equipment and motor vehicles. Output at factories, mines and utilities climbed 0.7 percent, exceeding the median projection in a Bloomberg survey, figures from the Federal Reserve showed.

European Union leaders meeting in Brussels endorsed “structural” budgetary assessments, using code for granting countries such as France, Spain and Portugal extra time to bring down deficits.

Novartis increased 0.3 percent to 65.65 francs, adding 4.5 points to the SMI. JPMorgan raised its recommendation for the shares to overweight, the equivalent of a buy rating, from neutral. Separately, the FDA gave Novartis’s LDK378 compound a Breakthrough Therapy designation for the treatment of patients with lung cancer.

The company is also said to be interested in Hikma Pharmaceuticals Plc’s injectable-drug business, two people with knowledge of the matter said. Spokesmen for Novartis and Hikma declined to comment.

Roche, another drugmaker, climbed 0.8 percent to 216.40 francs and Actelion Ltd. advanced 0.4 percent to 51.30 francs, the highest price since April 2011.

Daetwyler Earnings

Daetwyler, a provider of engineering and electronics components, surged 4 percent to 103.90 francs, the highest since at least 1989. The company reported a 33 percent increase in full-year net income to 127.5 million francs ($136 million).

Dufry advanced 1.2 percent to 124.20 francs, snapping seven days of losses. The operator of duty-free shops said 2012 earnings before interest, taxes, depreciation and amortization increased 28 percent to 474 million francs.

Lindt & Spruengli AG fell 0.2 percent to 40.910 francs. The world’s largest maker of premium chocolate reported a 12 percent increase in 2012 net income to 271.9 million francs, missing the 277 million-franc average estimate of four analysts surveyed by Bloomberg.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

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

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