Switzerland stocks advanced as U.S. consumer confidence rose to a four-year high in May, outweighing the Greek political crisis and JPMorgan Chase & Co (JPM:US)’s announcement of a $2 billion trading loss.
Holcim Ltd. (HOLN) and Actelion Ltd. led gains. Zurich Insurance AG lost 2 percent.
The Swiss Market Index gained 0.5 percent to 5,954.88 at the close of trading in Zurich. The gauge has still lost 1.7 percent this week as Greek leaders struggled to form a government after inconclusive elections, raising questions about that nation’s ability to obtain financial rescue and pay back its debt on time. The Swiss Performance Index rose 0.5 percent.
“Slight optimism that current negotiations in Greece will lead to the formation of a unity government soon and much better than expected Michigan sentiment data are giving stocks a lift to the upside in late trading,” Markus Huber, head of German sales trading at ETX Capital in London.
The Thomson Reuters/University of Michigan preliminary index of U.S. consumer sentiment climbed to 77.8, the highest since January 2008, from 76.4 the prior month. The gauge was projected to drop to 76, according to the median forecast of 68 economists surveyed by Bloomberg News.
JPMorgan Chief Executive Officer Jamie Dimon said the firm suffered the loss after an “egregious” failure in a unit managing risks. The firm’s chief investment office, run by Ina Drew, 55, took flawed positions on synthetic credit securities that remain volatile and may cost an additional $1 billion this quarter or next, Dimon said.
Greek Government Talks
Greece’s politicians entered their fifth day of talks today to form a unity government headed by Evangelos Venizelos, the socialist Pasok leader, to avoid another election.
The impasse has renewed concerns over Greece’s ability to comply with the terms of its two bailouts negotiated since May 2010 and sparked concerns that the country may leave the euro.
In China, a report showed that the country’s industrial output rose 9.3 percent in April from a year earlier. That compared with the 12.2 percent median estimate in a Bloomberg News survey and 11.9 percent in March.
Gross domestic product in the 17-nation euro area will drop 0.3 percent, the European Commission said today, reiterating a February forecast. Greece will have the deepest contraction, with GDP declining 4.7 percent this year, while the economies of Spain and Italy are seen shrinking 1.8 percent and 1.4 percent. In 2013, the euro-region economy may expand 1 percent.
Holcim, the world’s second-biggest cement company, gained 1.9 percent to 55.20 Swiss francs.
Actelion Ltd (ATLN), the country’s largest biotechnology company, rose 2.2 percent to 39.10 francs, gaining for a second day.
Syngenta AG (SYNN), a maker of agricultural pesticides, gained 1.9 percent to 313.70 francs.
Swiss drugmaker Novartis AG (NOVN) added 1.2 percent to 49.72 francs, while SGS SA, the world’s largest product-inspection company, gained 1 percent to 1,746 francs.
Zurich Insurance, Switzerland’s biggest insurer, lost 2 percent to 208.40 francs, dropping for a fourth day.
Swiss Re AG (SREN) slid 0.9 percent to 56.40 francs.
ABB Ltd, the largest power-grid supplier, fell 1.2 percent to 15.79 francs.
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