Swiss Stocks Little Changed After Bernanke TestimonyNandini Sukumar
Swiss stocks closed little changed as Federal Reserve Chairman Ben S. Bernanke said the pace of the economic recovery will determine when the U.S. central bank reduces its asset purchases.
Givaudan SA slipped 2.4 percent after analysts at Barclays Plc downgraded the biggest maker of flavorings. Credit Suisse Group AG and UBS AG, Switzerland’s largest lenders, rose amid optimism for bank earnings after Bank of America Corp. reported profit that beat analysts’projections.
The Swiss Market Index dropped less than 0.1 percent to 7,928.15 at the close in Zurich. The gauge has still rallied 3.2 percent this month amid speculation that central bank stimulus will continue. The broader Swiss Performance Index also declined less than 0.1 percent today.
The volume of shares changing hands in SMI-listed companies was 5.1 percent lower than the 30-day average today, according to data compiled by Bloomberg.
In the U.S., Bernanke said the Fed’s asset purchases “are by no means on a preset course” and could be reduced more quickly or expanded as economic conditions warrant. He spoke in testimony to the House Financial Services Committee.
The Bank of England’s Monetary Policy Committee voted unanimously to keep the target of its bond-purchase program at 375 billion pounds ($566 billion), as Paul Fisher and David Miles dropped their call for more stimulus. All nine members also wanted to keep the key interest rate at a record-low 0.5 percent, according to the minutes of their July 3-4 meeting published today.
Swiss investor confidence increased only slightly in July, signaling the economy may struggle to gain further momentum amid a slump in the neighboring euro area. An index of investor and analyst expectations, which aims to predict economic developments six months in advance, rose to 4.8 points in July from 2.2 in June, the ZEW Center for European Economic Research in Mannheim, Germany, and Zurich-based Credit Suisse said.
Givaudan slipped 2.4 percent to 1,265 francs. Barclays cut the stock to underweight, the equivalent of sell, from equal weight, saying so-called defensive shares are expensive and have little room to rise.
Holcim Ltd. slipped 0.8 percent to 65.20 francs, declining for a second day, after Exane BNP Paribas downgraded its rating on the cement maker.
Credit Suisse rose 0.6 percent to 26.90 francs and UBS advanced 1.3 percent to 17.02 francs. Bank of America’s second-quarter net income climbed to $4.01 billion, or 32 cents a share, from $2.46 billion, or 19 cents a share, a year earlier, the Charlotte, North Carolina-based firm said today. The average profit estimate of 28 analysts surveyed by Bloomberg was 26 cents.