Swiss equities began the new trading week on an upbeat note, with the Swiss Market Index up 0.61% on Monday's close, amid a quiet day of local economic news as markets mulled over the latest corporate updates and geopolitical developments related to the US-Iran war.
"While US President Donald Trump said Washington is 'semi-negotiating' with Iran, suggesting a focus on economic pressure rather than military escalation, significant hurdles remain before any broader agreement is reached. Reports indicate that Iran and Oman are nearing an agreement on a shipping route through Hormuz, though a full reopening of the waterway is still likely to depend on progress in US-Iran talks," according to strategists at ING.
On the economic front, the KOF Swiss Economic Institute's global economic barometers diverged in August after two months of joint advancement, with the coincident barometer edging down 0.4 points to 103.2 points and the leading barometer increasing 2.7 points to 104.4 points.
"The world economy continues to recover, with Europe also showing genuine signs of actual improvement. Despite the ongoing uncertainty surrounding the Strait of Hormuz and the adverse weather conditions affecting at least Europe, the sustained improvement in the leading indicator suggests that this may not just be a short-lived phenomenon," KOF director Jan-Egbert Sturm said. "Unfortunately, sudden geopolitical events have surprised us before."
Over to corporates, Aryzta (ARYN.SW) shares dropped 11.20% at closing as it recorded a year-over-year decline in first-half revenue to 1.06 billion euros from 1.09 billion euros. Profit for the period and EBITDA also fell 3.9% and 7%, respectively, to 47.2 million euros and 139.9 million euros, as underperformance in Germany offset growth achieved in other key markets. The Swiss bakery company said it is reviewing all options for Germany to boost shareholder value.
The Swiss parliament's Economic Affairs and Taxation Committee of the upper house is set to meet on Tuesday to discuss several changes to a draft bill to overhaul Switzerland's capital rules, Bloomberg News reported. The proposed changes include options such as reducing the amount of extra capital UBS Group (UBSG.SW) needs or allowing the banking group to fill half of the capital requirement with bonds rather than equity. The stock ended the trading session 0.85% in the green.