The Swiss Stock Market Pulled Back On Pharma Weakness

(RTTNews) - The Swiss stock market ended Thursday's session with a significant decline. The weak performance of the pharma heavyweights, as well as banks and cyclical stocks, weighed on the market. Disappointing U.S. economic data in the afternoon made for renewed downward pressure, after durable goods orders dropped more than expected.

Investors had their first opportunity to react to yesterday's announcement from the Federal Reserve. The Fed made no change to monetary policy, a month after raising interest rates for the first time in nearly a decade. In keeping the benchmark interest rate near 0.25 percent, the Federal Open Market Committee acknowledged economic weakness overseas, particularly China, is a threat to the U.S. recovery. The Fed did not completely rule out a rate hike at its next meeting in March.

The Swiss Market Index decreased 2.04 percent Thursday and finished at 8,153.27. The Swiss Leader Index dropped 1.39 percent and the Swiss Performance Index lost 1.76 percent.

Pharmaceutical stocks were among the hardest hit Thursday. Roche dropped 3.8 percent, after its full-year earnings came in slightly below forecasts. Novartis sank 3.9 percent, extending its losses from the previous session when it posted disappointing results. Shares of Actelion also finished down by 2.7 percent. The third defensive heavyweight, Nestle ended the day with a loss of 1.0 percent.

Bank stocks were also under pressure, due to the continued weakness in the Italian banks. Julius Baer declined 1.9 percent, Credit Suisse surrendered 2.2 percent and UBS lost 0.7 percent.

The prospect of a slowdown in the expected pace of interest rate hikes by the U.S. Federal Reserve weighed on most insurers. Zurich Insurance dropped 1.4 percent and Swiss Life fell 1.3 percent. Swiss Re finished with a gain of 0.1 percent.

Lonza decreased 2.3 percent, after the company reported strong financial results yesterday. Aryzta weakened by 1.8 percent and Adecco lost 0.7 percent. ABB and LafargeHolcim both declined by 0.9 percent each. Transocean dipped 0.2 percent, despite rising crude oil prices.

Sika was the best performing stock of the session, with an increase of 1.2 percent. Schindler rose 0.4 percent and Swatch gained 0.5 percent. However, Richemont finished lower by 0.8 percent.

In the broad market, Meyer Burger surged 5.8 percent. The solar supplier received 2 contracts valued at over 22 million francs.