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June 9 (Bloomberg) -- Swiss stocks climbed as European Central Bank President Jean-Claude Trichet left the bank’s inflation forecast unchanged, leading investors to speculate the ECB will raise rates less quickly than they had expected.
Syngenta AG, the world’s biggest producer of crop- protection chemicals, gained 2 percent. Straumann Holding AG, a dental implant maker, retreated 0.8 percent.
The Swiss Market Index of the biggest and most actively traded companies advanced 0.2 percent to 6,271.01 at the 5:30 p.m. close in Zurich. Even so, the measure has fallen 6.6 percent from this year’s high on Feb. 18 as U.S. manufacturing and payroll reports fueled concern that the recovery in the world’s largest economy is faltering. The broader Swiss Performance Index added 0.3 percent.
Trichet said the ECB hasn’t increased its 2012 inflation forecast from 1.7 percent, fueling speculation that the central bank will raise rates less quickly than investors had predicted. The ECB President signaled that the bank will increase interest rates in July, saying “strong vigilance” is warranted to contain inflation.
Even so, the central bank kept its benchmark interest rate at 1.25 percent today, and the Bank of England held its key lending rate at 0.5 percent and left its bond-purchase program unchanged at 200 billion pounds ($328 billion).
The U.S. Federal Reserve said yesterday after European markets closed that the economy expanded at a “steady pace” in most of the country, while it slowed in 4 of the 12 regions as consumers contended with higher food and fuel prices and shortages of parts reduced car production.
U.S. Trade Deficit
Swiss stocks climbed after the U.S. Commerce Department reported that the trade deficit narrowed in April reflecting a plunge in auto and oil imports combined with record exports. The gap shrank 6.7 percent to $43.7 billion, the lowest since December, the government report showed.
A report today showed the number of U.S. applications for unemployment insurance payments unexpectedly rose to 427,000 last week from 422,000 the previous week. Economists surveyed by Bloomberg News had forecast a drop in claims to 419,000.
Syngenta advanced 2 percent to 285.90 Swiss francs after Citigroup Inc. named the company as one of its most preferred stocks.
Transocean Ltd., the world’s largest offshore oil driller, rallied 2.3 percent to 54.50 francs and Weatherford International Ltd., a rival rig operator, added 1 percent to 15.59 francs as a gauge of oil and gas companies gained 1.6 percent. Crude gained for a third day in New York.
Straumann dropped 0.8 percent to 221.80 francs after BofA Merrill Lynch Global Research lowered its rating on the shares to “underperform” from “neutral.”
--Editor: Will Hadfield
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