In a challenging market environment, Swiss equities fell for the third straight day as investors sift through a wave of earnings reports and the latest inflation figures from both Europe and the US. The Swiss Market Index saw a decline of 1.46% at Thursday's close, reflecting a broader trend in European markets.
Recent data shows annual inflation in the euro area climbed to 2% in October, a rise from 1.7% in September, surpassing market expectations that anticipated a lower rate of 1.9%. On the other side of the Atlantic, the annual Personal Consumption Expenditures price index in the US reported a year-over-year increase of 2.1% in September, compared to a revised 2.3% uptick in August. "The eurozone's inflation rate increased more than expected, with core inflation stable at 2.7%.
The direction of incoming data in the region is not quite clear, which provides the ECB with confusing signals for the path of rate cuts," noted analysts at ING. "After the rapid decline in September, this provides a reality check about the eurozone's disinflationary process." Turning to corporate performances, Swiss travel retailer Avolta ($AVOL) confirmed its medium-term targets following a period of notable growth in the third quarter.
However, its stock price dropped by 2.40% at closing. "This year, we think Avolta should be benefiting from ongoing good demand for travel and a preference for experiential spending among consumers. We view trends in the wider market (e.g., premiumisation, hybrid formats) as supportive for topline growth in the longer term.
Although Avolta has had a volatile historical track record, we are encouraged by the lower levels of leverage now," analysts from RBC Capital Markets remarked. In contrast, Geberit ($GEBN), a manufacturer of sanitary products, experienced a stock increase of 4.68% following a reported year-over-year rise in third-quarter net income and net sales, reaching 150 million francs and 762 million francs, respectively, up from 148 million francs and 728 million francs.
Additionally, other companies such as Swisscom ($SCMN), battery manufacturer Leclanché ($LECN), and the Swiss National Bank ($SNBN) reported their financial results, contributing to the dynamic landscape of Swiss equities..