Bloomberg News

Swiss Stocks Fall as U.S. Data Disappoints; UBS Declines

May 03, 2012

Swiss stocks retreated for the fourth time in five days, erasing earlier gains after a gauge of U.S. service industries trailed analysts forecasts.

UBS AG (UBSN) and Credit Suisse Group AG (CSGN) followed European banks lower. Holcim Ltd. (HOLN), the world’s second-largest cement maker, lost 2.2 percent after German rival HeidelbergCement AG reported results that missed forecasts. Transocean Ltd. climbed after earnings topped analyst estimates.

The Swiss Market Index (SMI) slid 0.2 percent to 6,097.68 at the close in Zurich after earlier rallying as much as 0.7 percent. The gauge lost 2.2 percent last month amid renewed concern the euro area’s debt crisis may deepen. The Swiss Performance Index slipped 0.1 percent today.

“We know that there are some big macro issues out there,” said Henk Potts, an equity strategist at Barclays Wealth in London, which oversees $239 billion. “But the conflicting view is a very bright corporate environment and valuations are still very attractive. It’s a balancing act.”

Swiss stocks erased gains after service industries in the U.S. expanded less than projected and consumer confidence weakened, signaling the world’s largest economy may be cooling. The Institute for Supply Management said today its non- manufacturing index fell to a four-month low of 53.5 in April from 56 in March. The median forecast of economists surveyed by Bloomberg was 55.3. A reading above 50 signals expansion.

The volume of shares in SMI-listed companies changing hands today was 28 percent higher than the average over the past 30 days, according to data compiled by Bloomberg.

UBS, Credit Suisse

UBS paced a selloff in European banks, falling 2.6 percent to 11.44 Swiss francs while rival Credit Suisse slid 1.3 percent to 20.98 francs.

Banks fell as European Central Bank President Mario Draghi said policy makers didn’t discuss lowering interest rates at their meeting this week. The central bank kept its benchmark interest rate at a record low of 1 percent today as predicted by every economist in a Bloomberg News survey.

Holcim declined 2.2 percent to 55.35 francs as HeidelbergCement AG reported operating profit that trailed analyst estimates.

Transocean gained 2.5 percent to 46.85 francs after first- quarter earnings topped forecasts as maintenance costs rose less than expected. Excluding $184 million in charges mostly related to a goodwill expense, the company earned 64 cents a share, 32 cents more than the average analyst estimate. Sales climbed 8.7 percent to $2.3 billion.

Clariant AG (CLN) rallied 1.2 percent to 11.85 francs after the world’s largest maker of printing-ink chemicals confirmed its 2012 outlook and said it expects further sales growth and sustained profitability as the global economy strengthens.

The company posted adjusted earnings before interest and taxes of 160 million francs in the first quarter, missing the average analyst estimate of 163.5 million francs.

To contact the reporter on this story: Sarah Jones in London at sjones35@bloomberg.net

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


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