Swiss Stocks Decline Amid Concern Fed Will Trim Stimulus
Swatch Group AG, the biggest maker of Swiss timepieces, led declines on the benchmark Swiss Market Index. Actelion Ltd. (ATLN), the maker of Tracleer hypertension medicine, slid to the lowest price in six weeks.
The SMI (SMI) fell 0.5 percent to 7,839.27 at 9:49 a.m. in Zurich. The gauge has retreated in the past two weeks as investors speculated that improving economic data will lead to a paring of stimulus measures. The broader Swiss Performance Index also lost 0.5 percent today.
The Fed will probably trim its monthly asset purchases by almost a third in September if the labor market continues to strengthen, Joseph LaVorgna, Deutsche Bank AG’s chief U.S. economist, wrote yesterday in a note to clients.
The first reduction will be $25 billion, consisting of $10 billion fewer mortgages and $15 billion of Treasuries. This will bring monthly purchases down to $60 billion from the current level of $85 billion, LaVorgna predicted.
Fed Bank of Kansas City President Esther George, who has dissented against record stimulus at every policy meeting this year, and Fed Bank of Dallas President Richard Fisher called for a reduction in monetary support.
“Waiting too long to acknowledge the economy’s progress and prepare markets for more normal policy settings carries no less risk than tightening too soon,” George said in the text of a speech. She didn’t speak because of illness.
Swatch declined 1 percent to 549.50 Swiss francs. Actelion dropped 0.8 percent to 55.85 francs.
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