Swiss Stocks Fall Before ECB Meeting; Richemont, Swatch Decline
Swiss stocks retreated for a second day as investors awaited the outcome of separate European Central Bank and Bank of England interest-rate meetings.
Cie Financiere Richemont SA and Givaudan SA led declining shares on the benchmark index, falling at least 0.9 percent. Schmolz + Bickenbach AG (STLN) jumped after saying it plans a capital restructuring.
The Swiss Market Index (SMI) fell 0.3 percent to 7,852.16 at 10 a.m. in Zurich. The broader Swiss Performance Index declined 0.3 percent. Shares dropped from a five-year high yesterday as a report showed U.S. service-industries growth missed forecasts.
The ECB will leave its benchmark interest rate at a record low of 0.75 percent today, according to 54 of 56 economists in a Bloomberg News survey. Two predict a cut. The decision is due at 1:45 p.m. in Frankfurt and ECB President Mario Draghi holds a press conference 45 minutes later. He may face questions on the state of Cyprus’s banking sector, the country’s bailout deal and the ECB’s contribution to the agreement.
The Bank of England’s Monetary Policy Committee holds its first meeting since U.K. Chancellor of the Exchequer George Osborne reaffirmed the bank’s 2 percent inflation target while giving it more flexibility on hitting the goal so it can aid the economy. The bank will hold its key rate at a record low of 0.5 percent and maintain bond purchases at 375 billion pounds ($564 billion), according to the median estimates in Bloomberg surveys of economists.
Richemont, the owner of the Cartier brand, fell 1.2 percent to 74.95 Swiss francs.
Givaudan, the world’s biggest maker of flavorings and fragrances, declined 0.9 percent to 1,181 francs.
Swatch, the largest maker of Swiss watches, dropped 0.6 percent to 546.50 francs.
Schmolz + Bickenbach soared 8.9 percent to 2.57 francs. The steelmaker said it intends to expand its shareholder base as part of a capital restructuring and that Renova Industries Ltd. may participate in the process.
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