Nov. 14 (Bloomberg) -- Swiss stocks advanced to a five-month high as Janet Yellen, the nominee for Federal Reserve chairman, committed to promoting a strong U.S. economy, ensuring that monetary stimulus isn’t removed too soon.
Zurich Insurance Group AG jumped to the highest since May after Switzerland’s biggest insurer said third-quarter profit rose 64 percent, beating analyst estimates. Gategroup Holding AG climbed 2 percent as the airline caterer reported an increase in quarterly earnings. Nestle SA, which makes up about 21 percent of the benchmark gauge, added 0.8 percent.
The Swiss Market Index advanced 0.9 percent to 8,304.97 at the close of trading in Zurich, the highest since May 22. It has surged 22 percent this year, heading for the biggest annual gain since 2005, as central banks around the world pledged to leave interest rates low for a prolonged period. The broader Swiss Performance Index climbed 0.8 percent today.
“Yellen’s comments have soothed some investors’ fears that tapering will happen sooner rather than later,” said Peter Braendle, a portfolio manager at Swisscanto Asset Management AG in Zurich, where he manages about 500 million Swiss francs ($545 million). “The tapering won’t become a bigger topic again until the beginning of next year.”
Yellen voiced her commitment to using bond purchases known as quantitative easing to boost growth and lower unemployment. The U.S. jobless rate remains above 7 percent, more than four years after the world’s biggest economy began to recover from the deepest recession since the Great Depression.
“I consider it imperative that we do what we can to promote a very strong recovery,” Yellen said in response to a question during testimony to the Senate Banking Committee in Washington today.
A U.S. Labor Department report today showed that jobless claims in the week ended Nov. 9 declined to 339,000 from a revised 341,000 the prior period. The median forecast of 51 economists surveyed by Bloomberg called for a drop to 330,000.
The euro-area economy expanded 0.1 percent in the third quarter, meeting the median economist forecast, the European Union’s statistics office said today. A separate report showed producer and import prices in Switzerland dropped 0.3 percent in October from the same month last year.
Zurich Insurance climbed 2.5 percent to 258.50 francs, the highest price since May 22. Net income in the third quarter rose to $1.1 billion from a restated $672 million a year ago. Earnings surpassed the $993.5 million average estimate of eight analysts surveyed by Bloomberg. General insurance, the biggest unit, posted a 68 percent gain in operating profit to $755 million in the quarter.
Gategroup rose 2 percent to 25 francs, the most in almost 10 months. Third-quarter profit amounted to 23.2 million francs, compared with 12.2 million francs a year earlier, the company said in a statement today. Gategroup also said its restructuring program in Europe is on track to deliver 25 million francs in savings for 2013.
Comet Holding AG advanced 3.9 percent to 362.50 francs, the highest price since May 2002. The medical-equipment maker predicted 2013 sales to be as much as 250 million francs and an earnings before interest, taxes, depreciation and amortization margin of 13 percent to 14 percent.
“The surprisingly strong margin development increases our confidence in the ambitious long-term targets,” Andy Schnyder, an analyst at Vontobel Holding AG, wrote in a note to clients today. “Despite the good run of the share, there is more upside in the next 12 months on positive catalysts.”
Nestle, the world’s largest food company, added 0.8 percent to 66.85 francs, contributing the most to the SMI’s gain.
Transocean Ltd., the world’s largest offshore-rig contractor, declined 1.5 percent to 49.96 francs for the only declining stock on the SMI.
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