Swiss Stock Market Ends on a Positive Note Despite American Employment News: Top Stocks, Analysis, and More

2023-10-06 16:16:07

Zurich (awp) – The Swiss stock market ended on a positive note on Friday. After moving up and down in the green with an upward trend which had brought the SMI well above 10,800 points, American employment published at 2:30 p.m. caused the index to fall into the red, registering a new low from which it recovered and rose significantly above balance and 10,800 points.

In New York, Wall Street was slightly green in the morning following a negative opening.

Job creation rebounded unexpectedly in September in the United States, with 336,000 jobs created, twice as much as expected by economists. “A real shock” for John Plassard, investment specialist at Mirabaud.

“These are the highest figures in eight months and the August figures have also been significantly revised upwards,” he noted. The number of job creations in August reached 227,000, compared to 187,000 previously announced.

The unemployment rate remained stable at 3.8%, and wage growth decelerated slightly.

For John Plassard, this “indicates that the job market is gradually easing, but remains resilient despite the tightening campaign of the American Federal Reserve”.

In Switzerland, the labor market is holding up, despite slowing economic growth. The unemployment rate remained at 2.0% in September, a level expected for the whole year by Seco.

The SMI ended up 0.50% at 10,837.59 points, with a high of 10,854.05 and a low of 10,731.56. The SLI gained 0.72% to 1697.62 points and the SPI 0.31% to 14,162.69 points. Of the 30 star stocks, 22 rose, 7 fell and VAT finished stable.

Today’s podium consists of Julius Bär (+2.9%), Partners Group (+2.3%) and Swiss Life and Lonza (each +2.2%).

Once in the leading trio, the action of the reinsurer Swiss Re (+2.0%) benefited from an increase in its objective by Barclays, which confirmed “equal weight”. The analyst expects a strong third quarter with natural disaster-related claims below budget in property and casualty insurance. It also predicts stable performance in all other business segments.

Exane BNP Paribas raised the recommendation of UBS (+1.8% to 22.30 Swiss francs) to “outperform” from “neutral” and increased the price target to 28 Swiss francs from 24 Swiss francs. The controlled takeover of Credit Suisse had given rise to numerous uncertainties, recalls the analyst who nevertheless considers that the advent of the new Swiss banking giant now seems to be taking place under good auspices. If the current price still makes investors apprehensive in the face of uncertainties, the expert prefers to focus on the upward potential of the stock.

Julius Bär lowered the price target of Novartis (+1.3%) and confirmed “hold” and started covering Sandoz (-0.2%) with target at 34 Swiss francs and recommendation (buy). Without Sandoz, Novartis now have a higher growth and margin profile, according to the analyst who recalls that the newly emancipated company is in the world’s top three producers of generic drugs and focuses on the more profitable and less saturated segment of biosimilars.

Just behind the red lantern Lindt (good -3.8%) Nestlé (-2.5%) weighed on the index while the third heavyweight Roche (good +0.6%, buoyant +0.9%) supported him.

According to brokers, stocks in the food industry came under pressure in Europe and the United States following a representative of the giant Walmart explained that people who take drugs to reduce appetite or lose weight buy less of food products. In addition, a major US bank is said to have sold lots of shares in the sector. In the broader market, Barry Callebaut (-1.1%) also suffered.

The watchmaking giant Swatch Group (-0.1%) has acquired a building in central London for 90 million Swiss francs. The property described by the Bienne group as “prestigious” is located in New Bond Street, one of the most luxurious streets in the English capital, located a stone’s throw from Piccadilly Circus.

In the broader market, Implenia (+2.7%) won two contracts in Germany worth 100 million euros.

Spexis (+38.1%), struggling with its liquidity, will hold a situation update next Monday, promised at the end of September, on the state of its finances and its projects.

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