Swiss stocks rallied the most in 10 weeks, led by Nestle SA (NESN) and bank shares, after Spain sold more debt than it targeted at an auction.
UBS AG (UBSN) and Credit Suisse Group AG (CSGN), Switzerland’s biggest lenders, jumped more than 3.5 percent. Schindler Holding AG (SCHP) added 2.9 percent after Credit Suisse recommended buying the shares.
The Swiss Market Index (SMI) gained 1.2 percent to 6,200.27 at the close in Zurich, the biggest increase since February 3. The gauge yesterday rebounded from its longest stretch of weekly losses since November and has advanced 4.5 percent so far in 2012 as euro-area leaders took measures to contain the region’s debt crisis and as U.S. economic reports surpassed estimates. The broader Swiss Performance Index climbed 1.4 percent today.
Spain sold 3.18 billion euros ($4.18 billion) of bills today, against a target of 3 billion euros. The nation will auction debt due in 2014 and 2022 on April 19. Spanish bonds extended gains after the auction with the yield in the 10-year benchmark bond falling 16 basis points to 5.91 percent.
“Today’s auction is a good sign and will provide some support for the market,” said Markus Wallner, an equity strategist at Commerzbank AG in Frankfurt. “But investors will keep a sharp eye on the Spanish 10-year bond yields until Thursday at its bond auction.”
Spanish Prime Minister Mariano Rajoy has repeatedly said that the country won’t need a bailout. He said yesterday that there was no alternative to austerity. “Budget discipline and the rationalization of the public sector are good and necessary reforms.”
Stocks extended gains after the International Monetary Fund raised its global growth forecast. The world economy will expand 3.5 percent this year and 4.1 percent in 2013, the Washington- based IMF said, raising forecasts made in January. The U.S. will grow 2.1 percent this year and 2.4 percent in 2013, the IMF said.
In the U.S., a report showed that housing starts in March unexpectedly dropped to a 654,000 annual rate, the lowest in five months, following a revised 694,000 pace the prior month. Economists had called for an increase to 705,000.
A separate report showed that industrial production in the U.S. was unchanged in March for a second month. The output last month at factories, mines and utilities compared with a median projection for a 0.3 percent increase in a Bloomberg News survey of economists, data from the Federal Reserve showed today in Washington.
Nestle, the world’s largest food company, climbed 1.3 percent to 56.75 Swiss francs after peer Danone SA reported first-quarter revenue growth that topped analysts’ estimates.
UBS and Credit Suisse gained 4 percent to 11.82 francs and 3.6 percent to 24.60 francs, respectively. Julius Baer Group Ltd. (BAER) increased 2.8 percent to 36.09 francs. A gauge of European bank shares was the best performer of the 19 industry groups in the Stoxx Europe 600 Index.
Schindler rose 2.9 percent to 112.90 francs, its highest price in a year, after Credit Suisse raised the maker of escalators to outperform, the equivalent of buy, from neutral.
Sulzer AG (SUN), the world’s second biggest maker of pumps, added 4.8 percent to 126.60 francs. First-quarter orders rose 9.1 percent to 1 billion francs. The company said it sees 2012 orders growing by a “high single digit” percentage.
Galenica AG (GALN) gained 1.9 percent to 602.50 francs after saying a clinical study showed a dose of Ferinject rapidly improved fatigue symptoms in iron deficient, non-anemic women.
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