FINWIRES · TerminalLIVE
FINWIRES

Swiss Stocks Start Week on Positive Note; Galderma Joins Blue-chip Index

By

The blue-chip Swiss Market Index closed Monday's trading session 1.23% higher as investors prepare for an eventful week of business surveys and economic data releases, including the Swiss central bank's monetary policy decision.

In an interview over the weekend with Swiss daily Neue Zürcher Zeitung, UBS Group (UBSG.SW) Chief Executive Officer Sergio Ermotti described Switzerland's plan to require the bank to back its foreign subsidiaries with 90% or 100% common equity Tier 1 capital as "too much," adding that the additional costs will also affect customers and employees. The statement comes ahead of the Swiss parliament's upper house's highly anticipated Wednesday vote on new capital requirements for the group. The stock was up 0.48% on Monday's close.

"The total capital inefficiency is USD14bn on our calculation (up to USD21bn CET1) with the deficit standing at USD4bn (Q2 2026). However, depending on the CET 1 / AT 1 mix, the composition changes with a potential swing by USD20bn between 100% and 50% backing. The different mix has implications for funding costs and the ROTE," according to analysts at RBC Capital Markets. "Given the politics involved the challenge is likely to bring the debate to a conclusion soon at an outcome that is acceptable to all stakeholders. It looks like AT1 instruments and their nature could shape more of the UBS equity debate in the next couple of months (TBTF, AT 1 write down)."

Kuehne+Nagel (KNIN.SW) saw its shares gain 4.22% after announcing a long-term strategic collaboration with Amazon, including Amazon Web Services, on infrastructure lifecycle. The partnership includes a call option on the Swiss logistics company's shares, which can be settled by Amazon in cash or shares, tied to commercial milestones and services spanning up to seven years.

Meanwhile, Galderma Group (GALD.SW) commenced trading as part of the blue-chip index, joining the ranks of Switzerland's 20 largest and most liquid listed companies. The dermatology company's shares added 1.96% at closing.

While Monday was a quiet day for local economic news, the Swiss economic calendar for the week includes the country's current account figures for the second quarter and the interest rate decision from the Swiss National Bank (SNBN.SW).

What else is happening in Asia Markets?

Asia Markets

Tadawul Equities Start Week Lower; Saudi's Business Operating Revenue Index Rises in July

The Tadawul All Share Index closed Sunday 0.26% in the red as investors keep their eyes on Saudi Arabia's latest geopolitical updates and economic data.The Houthi group struck multiple locations in Saudi Arabia over the weekend. The group said it attacked "sensitive" sites, such as the Saudi Arabian Oil Co. (SASE:2222), d/b/a Saudi Aramco's, Yanbu-based facility. Aramco shares closed 1.33% higher.Also dampening sentiment is the continued conflict between Ukraine and Russia, with Ukraine launching drone attacks on Moscow, which caused casualties and infrastructure damage.Back at home, and according to preliminary data from the General Authority for Statistics, the kingdom's operating revenues index increased 4.9% annually in July."On a monthly basis, the Operating Revenues Index increased by 1.2%, supported by increases of 0.8% in manufacturing activities, 6.4% in mining and quarrying activities, 0.1% in construction activities, and increases of 3.7% and 0.6% in information and communication activities and accommodation and food service activities, respectively," the report said.Meanwhile, the employee compensation index climbed 7.4% year over year, while the issued building permits rose 4.4% annually to 5,828 from 5,582.On the corporate front, Public Investment Fund-owned Roshn Group entered into a preliminary deal with Talaat Moustafa Group's Saudi unit to potentially form a joint company for a mixed-use project in Riyadh.

^TASISASE:2222
Asia Markets

Update: US Equity Indexes Mixed as Benchmark Treasury Yield Jumps Back Above 5%

(Updates with index/price moves, macroeconomic data, and geopolitical news from the first paragraph.)US equity indexes closed mixed on Friday as government bond yields rebounded, with the 10-year yield hovering near its highest level in almost two decades.The Nasdaq Composite rose 0.4% to 26,522.55, the S&P 500 climbed 0.2% to 7,650.50, and the Dow Jones Industrial Average retreated 0.2% to 51,682.64. Materials, utilities and real estate led decliners at the close. Technology led the gainers."We now expect two more hikes from the [Federal Reserve], and our commodity analysts see energy markets facing a convergence of supply chain disruptions," Morgan Stanley said in a note after a 25 basis-point increase announced on Wednesday, the first policy tightening since 2023. "A higher expected path for oil prices means disinflation will be slower, and more restrictive policy also weighs on growth in 2027."Morgan Stanley expects two 25 basis-point rate increases in December and March to a target range of 4.25 to 4.50%. "They hold there through the end of next year."US Treasury yields rose after midday. The 10-year yield jumped 5.3 basis points to 5%, trading near its strongest level since 2007. The two-year yield climbed 6.2 basis points to 4.75%, a multi-month high.US equity funds recorded outflows for a fourth consecutive week as rising crude oil prices heightened inflation concerns and expectations of a Fed rate increase added to investor caution ahead of its policy decision, Reuters reported.The United Kingdom Maritime Trade Operations said an unknown projectile hit a tanker in the Strait of Hormuz, Al Jazeera, a Middle Eastern broadcaster, reported. Earlier, Iran's Islamic Revolutionary Guard Corps said it struck a Togo-flagged tanker as it attempted an "illegal passage" through the strait.The front-month US West Texas Intermediate crude oil contract slumped 2.5% to $99.39 per barrel, while the global benchmark North Sea Brent slipped 1.7% to $103.06 per barrel.In economic news, US industrial production unexpectedly held steady in August as manufacturing output fell after rising for seven straight months, Federal Reserve data showed. Industrial output was nearly flat sequentially last month, following a 0.2% gain in July, according to the Fed. The consensus was 0.3% for August in a Bloomberg-compiled survey.The Conference Board's measure of leading indicators slipped 0.1% in August, compared with expectations for a 0.1% gain in a Bloomberg-compiled poll and a 0.2% advance in July. The reading is the first monthly decline since March.In company news, Nucor (NUE) shares slumped 6%, one of the S&P 500's worst performers, after the company said late Thursday it expects Q3 earnings of $5.55 to $5.65 per diluted share, below analysts' consensus.

Dow JonesNasdaq CompositeS&P 500$NUE
Asia Markets

US Equity Indexes Mixed This Week as Benchmark Treasury Yield Trades Near 19-Year High Following Fed Rate Increase

US equity indexes closed mixed this week after the Federal Reserve reaffirmed its commitment to controlling inflation and tightened policy for the first time since 2023. Crude oil prices remained elevated above $100.* The S&P 500 closed at 7,650.14 on Friday, versus 7,656.98 a week ago. The Nasdaq Composite stood at about 26,522.55, compared with 26,333.04 a week earlier. The Dow Jones Industrial Average ended at 51,681.93, versus 52,573.29 at the end of last week.* Communication, healthcare, and technology were among the top gainers, while utilities, financials, and real estate were among the steepest decliners.* The US Federal Reserve raised its benchmark lending rate by 25 basis points in a unanimous vote on Wednesday to combat sticky inflation, while signaling another hike later this year. The Federal Open Market Committee raised the federal funds rate to 3.75% to 4%, the first time it has tightened monetary policy since July 2023.* "After more than five years of significantly elevated inflation, a period which included a rate-cutting cycle, the new Warsh Fed appears to be taking a step in the right direction to combat dangerously high price pressures," Lindsey Piegza, Stifel chief economist, said in a note.* The 10-year yield rose 5.1 basis points to 5%, trading close to its highest since 2007.* The United Kingdom Maritime Trade Operations said an unknown projectile hit a tanker in the Strait of Hormuz, Al Jazeera, a Middle Eastern broadcaster, reported. Earlier, Iran's Islamic Revolutionary Guard Corps said it struck a Togo-flagged tanker as it attempted an "illegal passage" through the strait.* The front-month US West Texas Intermediate crude oil contract fell 1.2% to $100.67 per barrel, while the global benchmark North Sea Brent declined 1.2% to $103.57 per barrel late Friday.

Dow JonesNasdaq CompositeS&P 500