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Swiss Market Index Slips Back into Red; Barry Callebaut Shares Down

Swiss equities fell back into negative territory on Wednesday, reflecting cautious investor sentiment as geopolitical tensions between the US and Iran re-escalated.

Joining a regional retreat in Europe, the Swiss Market Index was down XX% at closing.

The NATO summit in Turkey continued into its second and final day, with US President Donald Trump saying the interim ceasefire agreement with Iran was "over" after the latter carried out airstrikes on US bases in Bahrain and Kuwait. Trump also made fresh threats to take control of Greenland and cut trade ties with Spain.

On the macroeconomic front, the International Monetary Fund lowered its 2026 global growth forecast to 3% in its July World Economic Outlook report, down by 0.1 percentage point from its previous projection, mainly reflecting the effects of the Middle East war. For 2027, the expected global growth was increased by 0.2 percentage points to 3.4%.

Back home, the Swiss Confederation sold two series of bonds worth 360 million francs in a reopening at an auction, with settlement set for July 22, 2026. The 2.25% and 2.50% bonds are due June 2031 and March 2036, respectively.

Over to corporates, Deutsche Bank Research lowered its price target for Barry Callebaut (BARN.SW) to 960 francs from 1,000 francs, with a sell rating on the stock, noting the stock is priced for mid single-digit plus volume/mix growth. On Wednesday's close, the Swiss chocolate and cocoa products group's shares lost XX%.

"However, US employment in chocolate and confectionery manufacturing is declining and there is no recovery in European production. Production now, should be for peak season consumption later in the year," the research firm said. "We believe mix gains from a higher number of smaller users of gourmet/speciality product really drove the upside in the Barry model in the 2010's and we find it difficult to believe that the medium term operating environment will match that. However, the stock is priced for the same mix benefits."

Meanwhile, RBC Capital Markets expects Galderma Group (GALD.SW) to post an 18% sales growth at constant currency in the second quarter, moderating from a 26% increase in the prior three-month period, when it releases its latest financial results on July 23. The dermatology company's stock was down XX% at the end of the trading session.

"We make minor changes to our near-term estimates, but we lift our PT to CHF 175 (from CHF 155) on higher long-term Nemluvio and margin assumptions. However, we maintain Sector Perform as we believe its valuation premium (34x 27E P/E) reflects the strong growth trajectory, trading in line with higher-valued consumer peers (premium to biopharma) on a growth-adj. basis," according to RBC analysts.

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