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Swiss Market Index Closes Higher; Avolta to Enter Japan's Travel Retail Market

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The Swiss Market Index closed 0.45% in the green on Tuesday as investors took stock of the latest private sector and economic data prints at home and abroad.

Switzerland's current account surplus climbed to 15.54 billion francs in the first quarter from the revised 2.99 billion francs in the previous three-month period, according to data from the Swiss National Bank (SNBN.SW).

Zooming out to the euro area, the S&P Global Flash Eurozone Composite PMI Output Index rose to a three-month high of 49.5 in June from 48.5 in May. The seasonally adjusted provisional reading, however, remains below the neutral 50 threshold.

"The combination of sluggish growth and fading inflation concerns marks a dovish reading for the [European Central Bank]," ING said. "Both manufacturing and services experienced a slower pace of increase in their input costs and also increased their own prices less quickly than in May. And with energy prices now substantially lower thanks to the US-Iran deal, it could well be that this trend continues in the months ahead (if the deal holds, of course)."

On the corporate front, Avolta (AVOL.SW) agreed to purchase luxury travel retailer DFS' operations in Okinawa, marking the Swiss company's entry into Japan's travel retail market. The acquisition is expected to be completed in the third quarter. Avolta's shares were up 0.87% at the end of the trading session.

BofA Global Research lowered its price objective for Lindt & Sprüngli's (LISN.SW) registered shares to 134,000 francs from 137,000 francs, with the stock's buy rating maintained, on expectations that the chocolate confectionery manufacturer will report a "slow" organic growth of 3.6% in the first half amid "weakness" in Europe. The stock was up 4.40%.

"By region, we expect the growth to come from NorAm (9% OG in 1H) and RoW (8% OSG), benefitting from higher carryover pricing (came in later in FY25), with manageable volume pressure (helped by easier volume comps). However, we expect Europe OSG to turn negative (-1% OSG with -10% volume/mix), impacted by tough comps and a weak gifting category (Easter), especially in Germany (27% of Europe)," the research firm said in a note. "On profitability, we expect 10.2% EBIT margin, as we expect negative mix (weak Europe & gifting) to be offset by Inventory pricing."

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Asia Markets

Update: US Equity Indexes Mixed Amid Steep Decline in Communication Services, Surging Treasury Yields

(Updates with index/price moves and political/company news from the first paragraph.)US equity indexes traded mixed amid steep declines in communication services and consumer discretionary and rising government bond yields after midday Monday.The Nasdaq Composite dropped 1.2% to 26,194.83, with the S&P 500 down 0.4% to 7,472, while the Dow Jones Industrial Average rose 0.3% to 51,696.7.All sectors, except communication services, consumer discretionary, consumer staples and technology, gained. Real estate and healthcare led the gainers. Communication services sank 4.4%, and consumer discretionary was down 2%.Alphabet (GOOG, GOOGL) Google DeepMind data scientist and Nobel Prize winner John Jumper is leaving to join Amazon (AMZN) and Alphabet-backed Anthropic, he said Friday. Shares of Alphabet slumped nearly 6%, one of the steepest decliners on the S&P 500 and the Nasdaq.Netflix (NFLX) is looking to pursue additional partnerships with traditional broadcasters following the launch of its agreement with French broadcaster TF1, Chief Executive Officer Greg Peters told the Financial Times on Friday. Shares of Netflix dropped 6%, among the worst performers on the Nasdaq and the S&P 500.In geopolitical news, US Vice President JD Vance said Monday that Iran agreed to allow International Atomic Energy Agency inspectors into the country, according to media reports. "That is a major milestone for the American people, and the first step in permanently denuclearizing or permanently ending a nuclear weapons program in Iran, and that's exactly what we wanted to do," Vance was cited as saying.Iran's Foreign Minister Araghchi and the country's top negotiator Mohammad Bagher Ghalibaf are traveling to Oman to discuss the management of the Strait of Hormuz, Al Jazeera reported on Monday. The two are set to discuss consolidating Iranian arrangements for managing the strait and enhancing bilateral coordination, Ghalibaf said on Telegram, according to the news report.Front-month global benchmark North Sea Brent slumped 3.4% to $77.87 per barrel. The US West Texas Intermediate dropped 3% to $73.66 per barrel.Most US Treasury yields jumped, with the 10-year up six basis points to 4.52%. The two-year rate jumped 4.9 basis points to 4.23%. Even as oil prices have been declining since an interim peace deal was signed between the US and Iran, the market is still pricing two interest rate increases -- 25 basis points each -- by the end of this year, according to the CME FedWatch tool, following the hawkish lean seen in the June monetary policy announcement last week.In precious metals, gold futures fell 0.9% to $4,209.1, while silver futures declined 1% to $65.68.In company news, Chevron (CVX) has agreed to build a power plant in West Texas to supply electricity to a data center operated by technology giant Microsoft (MSFT), as part of a 20-year power purchase deal. Shares of Microsoft dropped 2.5%, among the steepest decliners on the Dow.AbbVie (ABBV) agreed to acquire Apogee Therapeutics (APGE) in an all-cash deal of about $10.9 billion, as the drugmaker looks to strengthen its immunology portfolio and accelerate its clinical presence in the respiratory segment. Shares of AbbVie advanced nearly 7%, one of the top gainers on the S&P 500.CRH (CRH) said it agreed to acquire building materials rival Arcosa (ACA) in an all-cash transaction valued at about $8.5 billion, expanding its infrastructure products business and strengthening its position in North America.

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Asia Markets

Exchange-Traded Funds, US Equities Mixed After Midday

Broad Market IndicatorsBroad-market exchange-traded fund IWM rose and IVV edged lower. Actively traded Invesco QQQ Trust (QQQ) shed 0.5%.US equity indexes traded mixed amid steep declines in communication services and consumer discretionary in Monday's midday trading.EnergyIShares US Energy ETF (IYE) rose 1.3%, and the State Street Energy Select Sector SPDR (XLE) added 1.2%.TechnologyThe State Street Technology Select Sector SPDR ETF (XLK) rose fractionally; iShares US Technology ETF (IYW) fell 0.4%, and iShares Expanded Tech Sector ETF (IGM) was down 0.7%.The State Street SPDR S&P Semiconductor (XSD) advanced 1.7%, and iShares Semiconductor (SOXX) gained 1.5%.FinancialThe State Street Financial Select Sector SPDR (XLF) added 0.6%. Direxion Daily Financial Bull 3X Shares (FAS) climbed 1.9%, and its bearish counterpart, Direxion Daily Financial Bear 3X Shares (FAZ), declined 2%.CommoditiesCrude oil fell 2.9%, and the United States Oil Fund (USO) slipped 2.7%. Natural gas climbed 1.6%, and the United States Natural Gas Fund (UNG) was up 1.6%.Gold on Comex eased 1%, and the State Street SPDR Gold Shares (GLD) fell 0.8%. Silver was down 1%, and iShares Silver Trust (SLV) shed 0.5%.ConsumerThe State Street Consumer Staples Select Sector SPDR (XLP) rose 0.1%. The Vanguard Consumer Staples ETF (VDC) added 0.1%, and iShares Dow Jones US Consumer Goods (IYK) was up 0.1%.The State Street Consumer Discretionary Select Sector SPDR (XLY) dipped 1.2%. VanEck Retail ETF (RTH) fell 0.8%, and the State Street SPDR S&P Retail (XRT) was down 0.3%.HealthcareThe State Street Health Care Select Sector SPDR (XLV) rose 1.2%, iShares US Healthcare (IYH) added 1%, and Vanguard Health Care ETF (VHT) was up 1.2%. IShares Biotechnology ETF (IBB) gained 1.9%.IndustrialThe State Street Industrial Select Sector SPDR (XLI) rose 0.9%. Vanguard Industrials Index Fund (VIS) and iShares US Industrials (IYJ) were also higher.CryptocurrencyIn midday activity, bitcoin (BTC-USD) rose 0.8%. Among cryptocurrency ETFs, ProShares Bitcoin ETF (BITO) gained 2.6%, ProShares Ether ETF (EETH) was up 2%, and ProShares Bitcoin & Ether Market Cap Weight ETF (BETH) was 3.8% higher.

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Asia Markets

Swiss Equities Kick Off Week in Green; Idorsia Shares Up

Swiss equities were in positive territory on Monday's close, with the Swiss Market Index up 0.54%, as investors gear up for a busy week filled with business surveys and economic data releases across key economies.Surveyed economic experts now expect Switzerland's real sports-adjusted gross domestic product to grow 0.9% in 2026, down from the 1% projection in March, according to the latest KOF Consensus Forecast. For 2027, economic growth is still anticipated to stand at 1.5%, while the five-year GDP growth rate estimate remains unchanged at 1.6%.Elsewhere and on the geopolitical front, the US and Iran made "encouraging progress" in their peace deal talks in Switzerland aimed at reaching a final agreement within 60 days, agreeing to establish a committee and a "de-confliction" cell involving Lebanon, mediators Pakistan and Qatar said in a joint statement."This marks a notable shift from Saturday's confusion, when Iran suggested the strait was now closed again after Israeli attacks in Lebanon, and briefly stepped back from talks following renewed threats from President Trump, who reiterated that the US would strike again if Iranian-backed proxies in Lebanon continue attacks on Israel," Deutsche Bank Research analysts said. "Despite that rhetoric, oil flows through Hormuz have continued and even picked up over the weekend, helping to calm markets, with Brent reversing earlier gains this morning before details of the talks came through."In the UK, Keir Starmer resigned as prime minister and leader of the Labour Party. He will remain in his post until a new party leader is selected, which is expected to take place before parliament returns in September.Over to corporates, Lonza (LONN.SW) signed a new licensing agreement with US-based biotechnology company InduPro to advance the development of innovative antibody-drug conjugate therapies. Under the deal, InduPro will gain a nonexclusive global license to the Swiss pharmaceutical manufacturer's proprietary GlycoConnect, HydraSpace and linker-payload technologies. Lonza closed the trading session 0.34% higher.Deutsche Bank Research raised its price target for Idorsia (IDIA.SW) to 4.50 francs from 4 francs, with a reaffirmed hold rating on the stock, ahead of the biopharmaceutical company's first-half results. Idorsia shares were up 1.67% at closing."Following the recent DD move - out of line with both the Swiss market and European healthcare -we take the opportunity to outline our view on (1) potential key drivers of the move and (2) revisit the investment thesis ahead of Q2 results (30th July), noting the underlying fundamental story remains unchanged and we reiterate our HOLD recommendation," the research firm said. "In the absence of fundamental newsflow across the three key catalysts highlighted in our post-Q1, we view the recent reaction as largely technical rather than fundamental driven."

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