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Swiss Market Index Begins Week in Green; Ams-Osram Falls

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Swiss stocks kicked off the new trading week on a positive note as investors gear up for a busy week of economic data prints and interest rate decisions from several major central banks.

At the end of Monday's trading session, the blue-chip Swiss Market Index was up 0.75%. Switzerland's monthly producer and import price index rose by 0.7% month over month in August and declined by 0.7% on a yearly basis to 100.4 points, according to data from the Federal Statistical Office.

Over to corporates, Zurich Insurance Group (ZURN.SW) secured all the necessary regulatory approvals for its planned acquisition of British peer Beazley, with the transaction set to be implemented via a court-sanctioned scheme of arrangement. A court hearing is set to take place on Sept. 22, while the scheme is expected to become effective Oct. 1 once certain remaining conditions are met. The Swiss insurer's shares closed 0.99% in the green.

Meanwhile, Deutsche Bank Research increased its price target for Ams-Osram (AMS.SW) to 19 francs from 16 francs, with a hold rating on the stock, noting that new form factors in consumer electronics are topical once again as markets head into the age of artificial intelligence, despite many failures. The light and sensor technology company's stock closed the session 10.58% lower.

"For example, Apple launched its first foldable smartphone last week (iPhone Duo, starting at $1,999), with expectations (IDC) to ship 17m units in 2027. Other players (Meta, Snap, openAI Google, Samsung, Chinese) are also exploring new form factors as we enter the AI era. Far beyond the capabilities of traditional smartglasses (e.g., Meta Ray Bans), one promising category is HUD (heads up display) smartglasses given the addition of lightweight info (e.g., notifications, directions, real-time translations directly into your field of view), initially starting with one eye (monocular display)," the research firm said.

Elsewhere and in geopolitical news, Gulf states postponed today's planned meeting with Iran regarding shipping through the Strait of Hormuz, as Yemen's Houthi rebels launched a fresh attack on military targets in Saudi Arabia, further escalating geopolitical tensions in the Middle East.

What else is happening in Asia Markets?

Asia Markets

Tadawul Share Plunge as Saudi Arabia Shuts Down East-West Oil Pipeline

The Tadawul All Share Index plunged 1.30% in the red on Sunday as the widening Middle Eastern conflict raised concerns regarding oil supply.Saudi Arabia closed its East-West oil pipeline as a precautionary measure after an Iraq-originated drone attack. The move resulted in injuries and damage, Reuters reported."The Ministry of Foreign Affairs expresses the Kingdom of Saudi Arabia's strongest condemnation of targetting the East-West Pipeline in the Riyadh and Madinah regions by several drones launched from Iraq, which resulted in injuries and some damage that is currently being recovered," the kingdom's Ministry of Foreign Affairs said. "The Kingdom of Saudi Arabia affirms that it reserves its right to take all necessary measures to safeguard its sovereignty and security, protect its facilities, and ensure the safety of its citizens and residents."In other news, another vessel was attacked in the Strait of Hormuz as Iran and other Gulf countries are set to meet in Oman for the waterway's future operations and routes.On the corporate front, Dar Al Majdiah Real Estate (SASE:4326) shares closed 0.16% higher as it entered into an agreement with Jadwa Al Maqar Real Estate Fund to serve as a developer for the Mishraf Al Majdiah in Madinah.Meanwhile, insurers Allied Cooperative Insurance Group (SASE:8150) and Salama Cooperative Insurance (SASE:8050) received the Insurance Authority's clearance to sell their tourist and domestic workers' contract insurance products in Saudi Arabia.Allied Cooperative and Salama Cooperative closed 4.96% and 3.18% in the red, respectively.

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Asia Markets

Update: US Equity Indexes Rise After August Inflation Print Triggers Rally in Shorter-Maturity Treasury Yields, Crude Oil Slumps

(Updates with index/price moves, comments and company/geopolitical news from the first paragraph.)US equity indexes rose amid a broad-based rally after August's inflation print sparked a surge in short-term government bond yields while crude oil slid ahead of a potential meeting between the Gulf states and Iran to stem their spiralling war.The Nasdaq Composite jumped 1% to 26,333.04, the S&P 500 rose 0.9% to 7,656.98, and the Dow Jones Industrial Average climbed 1% to 52,573.29 on Friday. All but two sectors, health care and utilities, rose. Communication services, consumer discretionary and technology led the gainers.The consumer price index rose 0.4%, the fastest pace since May and above July's 0.1% increase, Bureau of Labor Statistics data showed Friday. The move matched the Bloomberg-polled consensus. Core inflation jumped to a four-month high of 0.3%, exceeding projections for an unchanged 0.2% gain. On an annual basis, headline inflation held steady at 3.4%, as expected. The annual core measure eased to 2.4% from 2.5%, also in line with projections.Today's "ambiguous CPI data doesn't conclusively show evidence of continued disinflation or a continued trend of above-target inflation going forward," Jefferies Chief US Economist Thomas Simons said in a note."The rate decision at this meeting is a very close call, and it seems that no matter what the FOMC does, there will be criticism that they are making a mistake," Simons said. "If they hike, they will have to deal with setting expectations for further rate hikes, knowing that oil prices could crash at any time if there is a resolution to the situation in Iran. If they hold, they risk losing their inflation-fighting credibility, and they will be defying a market that is pricing in odds of nearly 90% for a hike."Supercore inflation - core services excluding housing - jumped 0.5% in August, marking the largest monthly gain in four months, according to a Stifel note. Over the past 12 months, the supercore grew 3.0%, accelerating from the 2.8% gain in July and marking the fastest pace since June.Last month, Fed Chair Kevin Warsh reiterated the Fed's commitment to eventually reinstating price stability, but market participants remained skeptical of any policy tightening, the Stifel note said. "There is no doubt the Fed should raise rates, but the question remains: Will they?"Most US Treasury yields rose. The two-year shot up 7.8 basis points to 4.63%, the highest since mid-2024. The 10-year yield climbed 2.7 basis points to 4.97%, the strongest level since October 2023.A six-member bloc of Gulf states is weighing a meeting with Iran next week to discuss the future of the Strait of Hormuz, people familiar with the matter told Bloomberg. Oman is aiming to assemble foreign ministers from the Gulf Cooperation Council and Iran on Monday in Salalah, a southern Omani city, sources told the news agency.The front-month US West Texas Intermediate crude oil contract slumped 2% to $100.44 per barrel, and global benchmark North Sea Brent dropped 2.6% to $104.80 per barrel. Both crude types were off their respective session lows after Saudi Arabia's Ministry of Energy said Friday that a key crude oil pipeline had been attacked and "was shut down as a precautionary measure," according to CNN.

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Asia Markets

US Equity Indexes Fall This Week as Benchmark Treasury Yield Hits Highest in Almost Three Years, Crude Oil Blows Past $100

US equity indexes fell this week as government bond yields surged to multi-year highs and crude oil soared following a worsening Iran war.* The S&P 500 closed at 7,656.98 on Friday, versus 7,718.60 a week ago. The Nasdaq Composite stood at 26,333.04, compared with 26,506.99 a week earlier, and the Dow Jones Industrial Average ended at 52,573.29, down from 53,414.25 at the end of last week.* Energy, technology and communication services led sectors, while healthcare sat at the bottom of sector charts.* The consumer price index rose 0.4%, the fastest pace since May and above July's 0.1% gain. The move matched the Bloomberg-polled consensus. Core inflation, which excludes the more volatile food and energy components, jumped to a four-month high of 0.3%, exceeding market projections for an unchanged 0.2% growth.* Interest rate traders are now pricing in an 87% probability that the Federal Reserve will raise its target rate by 25 basis points on Wednesday, up from 72% a day ago and 48% a month ago, according to the CME FedWatch tool.* The 10-year Treasury yield traded at 4.94% late Friday, the strongest level since October 2023, as inflation concerns mounted.* Yemen's Iran-aligned Houthis reached the strategic island of Perim in the Bab el-Mandeb Strait on Friday, Reuters reported, moving to tighten their grip on a vital global shipping route. If the Houthis gain control of the Bab el-Mandeb Strait, which is on the opposite side of the Arabian Peninsula from the Strait of Hormuz, it could give Iran a critical advantage in its war with the US, reducing supplies through a second major transit corridor, the news agency said Friday.* Also, this week, President Donald Trump acknowledged that the Iran war may last until after the November mid-term elections.* Global benchmark North Sea Brent crude oil surpassed $108.0 per barrel on Thursday following attacks on several crude oil carriers.

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