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