Stocks in Switzerland Decline as Adecco Falls
Swiss stocks fell, erasing earlier gains, as Swatch Group AG and Cie. Financiere Richemont SA shares declined and as investors turned their attention to the U.S. earnings-reporting season.
Swatch and Richemont declined more than 1 percent each. Adecco SA, the biggest supplier of temporary workers, dropped to the lowest price in three months after Credit Suisse Group AG (CSGN) downgraded its recommendation for the stock. Credit Suisse and UBS AG (UBSN) followed a gauge of European banks higher.
The Swiss Market Index (SMI) fell 0.5 percent to 7,653.95 at the close of trading in Zurich, after earlier rising as much as 0.5 percent. The gauge slid 2.2 percent last week as data on U.S. jobs and services industries signaled that the recovery in the world’s largest economy has slowed. The broader Swiss Performance Index also lost 0.5 percent today.
“While it looks like we may start to see a top formation as the fundamental picture tends to deteriorate, investors will focus on the U.S. and the further course of the markets will depend on the quarterly figures,” said Daniel Gschwend, portfolio manager at Diem Client Partner AG in Zurich, which oversees about $1.1 billion. Top formation is a chart pattern that signals price declines.
Alcoa Inc. yesterday kicked off the latest earnings-reporting season in the U.S. The largest U.S. aluminum producer posted quarterly sales that missed estimates and profit that beat forecasts. Earnings at companies in the S&P 500 Index may drop 1.8 percent in the first quarter, according to estimates compiled by Bloomberg.
Swiss stocks dropped after Federal Reserve Bank of St. Louis President James Bullard, one of the first Fed officials to urge slowing the pace of bond buying in 2013 if economic conditions allowed, told CNBC today that policy makers probably will “slowly ratchet down the pace of purchases” as the economy continues to improve.
German exports in February fell more than economists forecast, a report showed. Overseas shipments, adjusted for working days and seasonal changes, dropped 1.5 percent from January, when they gained 1.3 percent, the Federal Statistics Office in Wiesbaden said. Economists in a Bloomberg survey forecast a 0.3 percent decline.
The number of shares changing hands in companies on the SMI was 16 percent lower than the average of the past 30 days, according to data compiled by Bloomberg.
Swatch, the biggest maker of Swiss watches, slipped 1.4 percent to 519.50 Swiss francs, while Richemont, the owner of the Cartier brand, retreated 2.1 percent to 71.15 francs.
Adecco (ADEN) slid 1.8 percent to 49.49 francs after Credit Suisse cut the stock to neutral from outperform, advising investors not to buy any more shares of the company. The stock fell for a fifth day, its longest streak of losses since September.
Sonova Holding AG (SOON) dropped 3.7 percent to 108.20 francs, the largest decline in five months, after Hendrik Lofruthe, an analyst at HSBC Holdings Plc, cut the stock to neutral from overweight. HSBC cited the strong run in the share price and limited scope for “positive earnings revisions.”
Credit Suisse and UBS, Switzerland’s largest lenders, advanced 2.2 percent to 24.89 francs and 1.4 percent to 14.32 francs, respectively. A gauge of European banks was the second-best performer among the 19 industry groups in the Stoxx Europe 600 Index.
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