The Swiss stock market, which turned green after the announcement by the Swiss National Bank (SNB) to further relax its monetary policy, maintained its gains as midday approached. The guardian of the franc has in fact decided to reduce its key rate from 1.50% to 1.25%, an announcement welcomed in particular by industry representatives, such as Swissmechanic.
“This drop was not expected by analysts, but investors anticipated a drop of 25 basis points according to the options markets. The latter are expecting a BNS rate of 1% in December 2024,” underlined Arthur Jurus of Oddo BHF.
“The drop in rates supports the economy, in particular by making credit cheaper,” notes Brian Mandt, chief economist of the Lucerne Cantonal Bank (LUKB). He believes that inflation will remain on track in Switzerland, which leaves “room for maneuver for the SNB to further lower its key rate”, counting on a rate of 1% within a year.
The Bernese institute has also revised downwards its inflation forecast for this year, to 1.3% compared to 1.4% in the target range.
In terms of macroeconomics, the Swiss trade surplus reached 4.1 billion francs in May, despite a 1.6% decline in shipments abroad in seasonally adjusted terms. Watch exports fell by more than 2% year-on-year, to 2.3 billion francs.
Shortly before 11 a.m., the SMI rose by 0.22% to 12,089.34 points, the SLI by 0.49% to 1,959.42 points and the SPI by 0.27% to 16,061.87 points. Of the thirty main stocks, 23 advanced and seven lost ground.
Partners Group (+2.0%) was in the lead, ahead of Sika (+1.8%) and SIG Group (+1.6%).
Kühne +Nagel (+0.8%) has opened a logistics site for the French clothing brand Sézane in the United States.
VAT had regained momentum (+0.7%) after Morgan Stanley lowered its recommendation to “equal weight” compared to “overweight” previously.
The Geneva luxury brand manager Richemont (-0.1%) limited the damage in the wake of the drop in exports of timepieces last month. Its Biel-based competitor Swatch Group lost more, at -0.4%.
Among the three heavyweights, the good Roche managed to get its head above water (+0.1%), when Nestlé was at the bottom of the ranking with Novartis (-0.4% each). The Basel company has launched the process of delisting its German partner Morphosys.
UBS (-0.2%) “already met, at group level, the future requirements that the bank anticipates in terms of capital under the too big to fail (TBTF) regulation”, according to the SNB financial stability report .
On the broader market, Basilea (+0.3%) continues its withdrawal from oncology with an agreement to sell lisavanbulin (BAL101553) to the American non-profit organization Glioblastoma Foundation.
SHL Telemedicine took 2%. Trading in the stock was suspended for a time due to negotiations with Discount Capital for a sale of its activities in Israel.
Klingelnberg (+2.7%) proposes an improved dividend despite a stable financial year. (AWP)
