Swiss stocks fell, with the benchmark index posting its biggest weekly loss in 21 months, as investors weighed the prospects for U.S. military action against Syria and a reduction in bond purchases by the Federal Reserve.
Credit Suisse Group AG slipped 1.9 percent. Implenia AG tumbled the most in 21 months after Switzerland’s largest builder said two long-term investors may reduce their stakes in the company. Zurich Insurance Group AG, the insurer whose chairman quit this week, rose 1.2 percent.
The SMI fell 0.2 percent to 7,745.97 at the close in Zurich. At a loss of 3.3 percent this week, the measure wrapped its biggest retreat since November 2011 amid concern that any military action by the U.S. against Syria may escalate into a larger conflict. The SMI slid 1 percent in August, the second monthly retreat in 2013. The broader Swiss Performance Index also slid 0.2 percent today.
“There is still uncertainty in the markets,” Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland, said. “The situation in Syria and Fed tapering that may start this fall are issues of concern. It’s not surprising to see some investors taking their profits or trying to hedge. With a long weekend ahead for the U.S. with Labor Day, not much action can be expected today.”
The U.S., which has said it will hold Syria accountable for deadly chemical-weapons attacks, was left to contemplate a unilateral attack after the U.K. opted out of a military strike. Britain, the U.S. ally in the Iraq and Afghanistan wars, took the decision after the House of Commons voted against the use of force. France has said it is ready to act in Syria.
The Federal Reserve holds a policy meeting on Sept. 17-18 to decide whether to slow the pace of its bond-purchase program. Fed Chairman Ben S. Bernanke said in testimony to the Joint Economic Committee of Congress on May 22 that the central bank’s pace of bond buying will slow if the employment outlook “improves in a real and sustainable way.” On June 19, he said the Fed may start reducing stimulus this year and end debt purchases in mid-2014 if the economy grows as forecast.
Credit Suisse, Switzerland’s second-biggest bank, fell 1.9 percent to 26.82 Swiss francs, while Julius Baer Group Ltd. dropped 1.7 percent to 41 francs.
Implenia declined 5.1 percent to 52 francs after saying long-term investors Ammann Group Holding AG and Rudolf Maag plan to reduce their stakes in the company. The reduction should represent about 10 percent of share capital.
Santhera Pharmaceutical Holding AG slid 4.3 percent to 2.23 francs. The drug developer posted a loss of 3.2 million francs in the first half and said it continues to explore financing options.
Zurich Insurance advanced 1.2 percent to 231.60 francs, rebounding from the biggest four-day drop since April 10, as Chief Executive Officer Martin Senn said the company’s strategy remains unchanged after the death of Chief Financial Officer Pierre Wauthier and the resignation of Chairman Josef Ackermann.
Clariant AG gained 1.3 percent to 15.09 francs as Goldman Sachs Group Inc. raised the stock to buy from sell.