Swiss Stocks Fall as U.S. Adds Fewer Jobs Than ForecastTom Stoukas
Swiss stocks retreated, posting their biggest two-day drop in 16 months, as a report showed the U.S. economy created fewer jobs than expected.
Swatch Group AG posted the biggest decline on the benchmark Swiss Market Index, slipping 4.1 percent. Holcim Ltd. retreated
The SMI lost 1.6 percent to 7,641.11 at the close of trading in Zurich. The equity benchmark slid 1.4 percent yesterday as European Central Bank President Mario Draghi warned of risks to the euro area’s economic recovery in the second half. The gauge dropped 2.2 percent this week. The broader Swiss Performance Index also fell 1.6 percent today.
“There is disappointment on the employment report,” John Plassard, who helps oversee $28 billion as vice president at Mirabaud Securities LLP, said in a telephone interview from Geneva. “Also, we have touched some highs this week, so before the weekend people are taking profit.”
The SMI climbed to its highest level this year on April 2. The number of stocks changing hands in the Swiss gauge was 15 percent greater than the average of the past 30 days, according to data compiled by Bloomberg.
In the U.S., the non-farm payrolls report showed that employers in the world’s largest economy hired a net 88,000 workers in March, fewer than the 190,000 forecast by economists. The unemployment rate dropped to 7.6 percent. The labor force participation rate decreased to 63.3 percent, the lowest since May 1979.
The Swiss currency reached a 20 month-low of 1.2569 per euro in January. The franc has since strengthened to 1.2148 as Cyprus negotiated a bailout from the European Union and the International Monetary Fund, while a workable government failed to emerge from Italy’s parliamentary elections.
“There is a link between the Swiss franc and the evolution of the Swiss indexes,” Plassard said. “If in one month the Swiss franc is at 1.20 against the euro, of course the indexes will be much lower than today.”
Swatch Group AG, the biggest maker of Swiss watches, retreated 4.1 percent to 517.50 francs, its biggest drop in 10 months. Cie. Financiere Richemont, the owner of the Cartier brand, slid 3.2 percent to 71.10 francs.
Holcim, the world’s largest cement maker, dropped 3.7 percent to 71.25 francs.
Nestle SA, the world’s largest food company which accounts for 23 percent of the SMI, slid 2 percent to 67.30 francs.
Toilet manufacturer Geberit AG declined 2.2 percent to
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