The Swiss stock market stumbled in early trading on Tuesday, with concerns about the economy and politics seeming to overtake the previous day’s surge in confidence. The Old Continent is also due to provide an update on inflation developments in June.
“European Central Bank (ECB) chief Christine Lagarde has warned that the bank does not have enough evidence that it has regained control over the inflation threat, suggesting that it could skip a second rate cut in July,” Ipek Ozkardeskaya wrote for Swissquote.
In the evening, the speakers will be able to get a more precise idea of the configuration of the forces present for the second round of early legislative elections in France, after the deadline for strategic withdrawals has expired.
“The outcome of the first round was certainly more favourable than expected from an investor perspective, but a political paralysis is looming, which risks complicating the implementation of the necessary reforms,” Raiffeisen said in a morning commentary.
Regional uncertainties prevented European markets from capitalizing on the positive closing of Wall Street on Monday evening.
The United States has yet to provide any data on the health of the jobs market.
At 09:08, the Swiss Market Index (SMI) was down 0.91% at 11,940.56 points, thus falling below the symbolic 12,000 point mark. The Swiss Leader Index (SLI) also fell 0.91% to 1,933.89 points and the Swiss Performance Index (SPI) 0.86% to 15,852.59 points.
Kühne+Nagel (-1.0%) was the only happy exception among the thirty stocks making up the SLI. The Schindellegi-based logistics company benefited from an upgrade of its recommendation to “equal weight” by Barclays.
The construction materials giant Holcim (-2.2%) brought up the rear, despite an increase in the price target by Jefferies.
Luxury brand manager Richemont (-1.0%) has announced a change at the helm of its portfolio jewel, Cartier.
The defensive heavyweights were falling in a scattered order, with the food liner Nestlé already down 0.4% while the pharmaceutical giants Novartis (-1.0%) and Roche (-1.4%) were drifting even more sharply.
In the broader market, holiday resort developer and operator Orascom DH rose 5.3%, following a land sale in Egypt.
Liechtensteinische Landesbank (-0.4%) acquired the Austrian business of Zurich Cantonal Bank (ZKB, unlisted) for an undisclosed amount.
Hospital communications solutions specialist Ascom (not covered) has entered into a partnership south of the Alps for the deployment of its Digistat platform. (AWP)
