Swiss stocks fell from a two-week high as a deadline neared for the lapse of the U.S. government’s borrowing authority and Fitch Ratings placed its AAA credit rating on negative watch.
Swatch Group AG and Cie. Financiere Richemont SA retreated more than 2 percent after LVMH Moet Hennessy Louis Vuitton SA reported revenue that missed projections. Holcim Ltd. (HOLN) and Baloise Holding AG (BALN) declined after JPMorgan Chase & Co. recommended selling the shares. Swisscom AG (SCMN) rose 1.2 percent as Citigroup Inc. upgraded its recommendation for the stock.
The SMI (SMI) dropped 0.5 percent to 7,946.64 at 9:51 a.m. in Zurich. The gauge has lost 1 percent so far this month, trimming its 2013 increase to 16 percent. The broader Swiss Performance Index also slipped 0.5 percent today.
U.S. Senate leaders began working on an alternative plan to end a fiscal impasse that has seen the government partially shut down since Oct. 1 and come close to exhausting its $16.7 trillion borrowing capacity. A plan forwarded by House Republicans collapsed yesterday.
The new Senate accord may be announced today and must be approved by the Republican-led House. If passed, it would fund the government through Jan. 15, 2014, and suspend the debt limit until Feb. 7.
Fitch Ratings yesterday put the U.S. AAA credit grade on ratings watch negative, citing the government’s inability to have the debt ceiling raised in a timely manner, according to a statement after markets in New York closed.
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