Swiss Stocks Advance Most in Two Weeks as Adecco Rises
Stocks in Switzerland gained the most in two weeks, snapping a three-day drop for the Swiss Market Index, as Adecco SA shares rallied and investors awaited tomorrow’s policy decisions from the European Central Bank.
Adecco, the world’s largest provider of temporary workers, climbed to a six-year high after third-quarter profit topped estimates. UBS AG (UBSN) and Credit Suisse Group AG (CSGN) each rose more than 1 percent. Gottex Fund Management Holdings Ltd. (GFMN) jumped 23 percent after agreeing to take a stake in a Chinese venture.
The SMI (SMI) gained 0.9 percent to 8,224.58 at the close of trading in Zurich, its biggest jump since Oct. 22. The gauge rallied 2.6 percent in October as U.S. lawmakers reached a deal to avoid a sovereign default and end a partial government shutdown. The broader Swiss Performance Index added 0.9 percent today.
“There are some investors who expect the ECB to cut rates tomorrow after yesterday’s downward revision of the European growth outlook,” said Daniel Rotzer, an investment adviser at LGT Bank Schweiz AG in Zurich. “At the same time, there are more Federal Reserve voices agreeing that tapering should be delayed further. The Swiss market is being supported by Adecco (ADEN) with strong quarterly results.”
The volume of shares changing hands in companies listed on the SMI was 58 percent greater than the average of the past 30 days, data compiled by Bloomberg show.
Three of 70 economists’ estimates compiled by Bloomberg predict the European Central Bank will cut its benchmark interest rate to 0.25 percent at tomorrow’s meeting. Eight of 38 economists in a separate survey forecast policy makers will lower interest rates in December.
Data showed German factory orders in September increased more than estimated. In the U.K., industrial production climbed 0.9 percent in September, the Office for National Statistics said in a separate report.
Adecco gained 3.6 percent to 68.50 Swiss francs. Net income in the third quarter rose 61 percent to 190 million euros ($256 million), beating the 138.2 million-euro average estimate of five analysts in a Bloomberg survey. The company also reiterated a target to achieve a margin based on earnings before interest, taxes and amortization of above 5.5 percent by 2015.
“As European countries exit recession, we expect to see further growth into the fourth quarter and next year, with a favorable impact on profitability,” Michael Foeth, an analyst at Vontobel Holding AG, wrote in a note to clients today.
Credit Suisse gained 3.7 percent to 26.95 francs, rebounding from a three-day decline of 8 percent. UBS rose 1.4 percent to 16.77 francs and Julius Baer Group Ltd. increased 1.3 percent to 42.70 francs.
Gottex jumped 23 percent to 2.42 francs, its biggest gain since August 2011. The company will form a joint venture with VStone Asset Management to offer China-based products, Gottex Asia Chief Executive Officer Max Gottschalk said.
ABB Ltd. (ABBN), the world’s largest maker of power transformers, climbed 1.2 percent to 23.17 francs after peer Alstom SA reported first-half operating profit that beat analyst estimates.
Holcim Ltd., the world’s biggest cement maker, gained 1.6 percent to 69 francs. A gauge of European construction companies posted the second-best performance on the Stoxx Europe 600 index.
Gurit Holding AG advanced 3.7 percent to 416.75 francs, the most in two weeks, as the maker of materials for turbine propellers signed a distribution agreement with Maricell Srl.
The agreement is “positive news as it enhances mid-term sales by 10 percent,” Patrick Rafaisz, an analyst at Vontobel, wrote in a report.
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