Swiss Market Index Starts Week Little Changed; Zurich Insurance Shares Up
The Swiss Market Index kicked off the new trading week little changed, closing 0.07% higher on Monday, amid news that the US and Iran reached a preliminary deal to end the war."[After] 107 days and a seemingly endless number of false dawns, we finally have a deal between the US and Iran to end the war and open the Strait of Hormuz. It was announced at around 10:30pm UK last night and the MoU will be signed in Switzerland on Friday," Deutsche Bank Research said in a note. "The deal also sets out a 60-day negotiation window on a broader accord, including constraints around Iran's nuclear programme, where Tehran is expected to commit to maintaining its current status and not pursuing nuclear weapons."On the economic front, data from the State Secretariat for Economic Affairs showed that Switzerland's consumer sentiment index slightly improved to -38 points in May from -40 points in April. In the previous year, the index stood at -36.5. Meanwhile, the country's producer and import price index fell by 0.4% month over month in May and by 1.8% on a yearly basis to 100.1 points, according to the Federal Statistical Office.In other news, 54.79% of Swiss citizens over the weekend voted against a proposal to cap the country's permanent resident population at 10 million, while 45.21% were in favor, according to provisional official results.Over to corporates, Berenberg lifted its price target for Zurich Insurance Group (ZURN.SW) to 902 francs from 711 francs, while maintaining the buy rating on the stock, on expectations that the Swiss insurer will benefit from its planned $10.9 billion acquisition of British peer Beazley. Zurich's shares gained 1.53% at closing."The deal is set to close in H2 2026, when we believe Zurich will likely provide a clear update on its adjusted 2025-27 targets. The Beazley uplift is attractive: it is set to be mid-single-digit EPS-accretive by 2027, and is set to provide a double-digit return on investment, which we believe could already be achieved in 2029, and should therefore help Zurich achieve its 2025-27 plan targets of over 9% core EPS growth, over 23% ROE and over USD19m in cumulative cash remittances," the research firm said in a report on European composite insurers.Swiss investment manager Vontobel (VONN.SW) expanded its presence in the US by opening a new office in Los Angeles, California, as part of its growth strategy in the North American country. The stock was up 0.98% at the end of the trading session.