Bloomberg News

Swiss Stocks Decline as U.S. Consumer Confidence Slides

March 27, 2012

Swiss stocks declined for the sixth time in seven days, led by losses in Holcim Ltd. (HOLN) and Nestle SA (NESN), after a report showed confidence among U.S. consumers dropped this month.

Holcim, the world’s second-largest cement maker, sank 3 percent after selling treasury stock. Nestle, the biggest food maker, slipped 0.4 percent. Basilea Pharmaceutica (BSLN) jumped 6 percent after Helvea AG said the company may enter a partnership with another drugmaker on an antibiotic.

The Swiss Market Index (SMI), a measure of Switzerland’s largest and most actively traded companies, fell 0.2 percent to 6,269.38 at the close in Zurich. The gauge has still rallied 5.6 percent this year as U.S. economic reports beat estimates and optimism grew that the euro area’s debt crisis can be contained. The broader Swiss Performance Index also lost 0.2 percent today.

“We’ve gotten to a point with the markets where there’s a bit of resistance setting in,” said Mike Lenhoff, head of research at Brewin Dolphin Securities Ltd. in London. Investors “realize they’ve done very well on the back of positive news flow, but that can only take them so far.”

The number of shares changing hands on the SMI was 8.5 percent lower than the 30-day average, data compiled by Bloomberg show.

The New York-based Conference Board’s U.S. consumer confidence index dropped to 70.2 in March from a revised 71.6 reading in February that was higher than initially reported. The median forecast of economists surveyed by Bloomberg News called for a decrease to 70.

U.S. Housing

House prices in 20 U.S. cities fell at a slower pace in January. The Standard & Poor’s/Case-Shiller index dropped 3.8 percent from a year earlier, matching the median estimate of economists in a Bloomberg survey.

A gauge of Swiss consumer demand declined for a second month in February, UBS said. The consumption indicator, which signals developments about three months ahead, slipped to 0.87 points from a revised 0.93 points in January. UBS had previously reported a January reading of 0.92 points.

Holcim dropped 3 percent to 59.30 francs, the largest decline in three weeks. The company raised 296 million francs ($327 million) by selling a 1.5 percent stake of treasury stock at 59.25 francs a share to improve its finances.

Nestle, the biggest stock in the SMI, retreated 0.4 percent to 56.75 francs.

Basilea jumped 6 percent to 52.05 francs after Olav Zilian, an analyst at Helvea, said the Swiss drugmaker may enter a partnership with a large pharmaceutical company such as GlaxoSmithKline Plc or a mid-sized one such as Cubist Pharmaceuticals Inc. on an experimental antibiotic.

To contact the reporter on this story: Namitha Jagadeesh in London at njagadeesh@bloomberg.net

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


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