Bloomberg News

Swiss Stocks Decline Amid Weaker-Than-Forecast U.S. GDP Growth

November 23, 2011

Nov. 22 (Bloomberg) -- Swiss stocks retreated for a fourth day after a report showed that the U.S. economy grew in the third quarter at a slower pace than economists had estimated and as bond yields climbed in Spain and Belgium.

UBS AG and Credit Suisse Group AG, Switzerland’s largest lenders, led losses, sliding more than 1 percent. Clariant AG, the biggest maker of printing-ink chemicals, dropped 2.8 percent.

The Swiss Market Index, a measure of the largest and most actively traded companies, slid 0.5 percent to 5,447.66 at the close in Zurich after earlier climbing as much as 0.8 percent. The gauge has still rebounded 14 percent from this year’s low on Aug. 10 amid speculation that policy makers will act to resolve the euro area’s debt crisis. The Swiss Performance Index also fell 0.5 percent today.

“There are practically no investors in the markets at the moment,” said Benno Galliker, a trader at Luzerner Kantonalbank in Lucerne, Switzerland. “The markets are dominated by speculators, hence the continuing up and down without any clear tendencies.”

In the U.S., a Commerce Department report showed that gross domestic product in the world’s biggest economy climbed at a 2 percent annual rate from July through September, less than projected and down from an earlier estimate of 2.5 percent. The median forecast of 81 economists surveyed by Bloomberg News had called for no revision.

Spain’s bonds fell, pushing two-year yields toward their highest level since 2000, as financing costs surged at bill auctions today. In Belgium, 10-year bonds extended their decline, pushing the yield on the securities to more than 5 percent for the first time since July 2008.

U.S. Rating

Standard & Poor’s and Moody’s Investors Service maintained their U.S. credit ratings even as Congress’s special debt- reduction committee failed to reach an agreement, setting the stage for $1.2 trillion in automatic spending cuts.

S&P reaffirmed it would keep its U.S. rating at AA+ after stripping the government of its top AAA grade on Aug. 5 and Moody’s kept its AAA rating with a negative outlook. Fitch Ratings noted in a statement that in August it said a supercommittee failure would probably result in a “negative rating action.” Fitch added that it will conclude a review by the end of this month.

UBS fell 2.1 percent to 10 Swiss francs and Credit Suisse dropped 1.3 percent to 19.98 francs as a gauge of European banks was among the worst performers on the Stoxx Europe 600 Index.

Clariant retreated 2.8 percent to 7.85 francs after Moody’s Investors Service changed its rating outlook for the company to stable from positive.

Lonza Group AG, the world’s biggest maker of drug ingredients, added 1.3 percent to 52.60 francs.

Givaudan SA, the world’s largest maker of flavors and fragrances, rallied 4 percent to 793 francs and Syngenta AG, the world’s biggest producer of crop-protection chemicals, increased 1.1 percent to 258 francs.

--With assistance from Adria Cimino in Paris. Editors: Jennifer M. Freedman, Will Hadfield

To contact the reporter on this story: Corinne Gretler in Zurich at cgretler1@bloomberg.net

To contact the editor responsible for this story: Andrew Rummer at arummer@bloomberg.net


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