Swiss equities faced a downturn on Tuesday, with the Swiss Market Index registering a decline of 0.26%. Investors are analyzing recent economic data while also monitoring developments related to the US elections. The KOF Business Situation Indicator, which reflects sentiment in the Swiss private sector, improved to 11.5 in October from 10.7 in September.
This positive shift was largely fueled by activity in the manufacturing and service sectors. Conversely, sectors such as construction, project engineering, retail, financial services, insurance services, and hospitality observed a deterioration in their business environments. The KOF commented, 'Overall, this indicator has been trending more or less sideways - with minor fluctuations - since the spring.
The Swiss economy is not experiencing a stable recovery.' The organization noted that businesses are generally adopting a more cautious approach regarding their expectations for activity over the upcoming six months. On the labor front, the unemployment rate in Switzerland remained steady at 2.5% in October, unchanged from the prior month, with the employed population increasing by 2.8% to reach 116,447 individuals during that timeframe.
In the corporate landscape, Swiss Re, one of the leading reinsurers, finalized an agreement to divest its iptiQ division's European property and casualty business to Allianz Direct as part of its strategic withdrawal plan from iptiQ. The transaction is expected to finalize in the second or third quarter of 2025.
Following the announcement, Swiss Re's stock experienced a rise of 1.59%. Conversely, the shares of Adecco Group, a Swiss recruitment firm, fell by 5.93% after reporting a year-over-year decline in net income for the third quarter, dropping to 99 million euros from 103 million euros. This decline was largely attributed to increased interest expenses and other associated costs.
Additionally, revenue fell from 5.96 billion euros to 5.70 billion euros during the same period. Investors are closely watching these developments, as the market navigates a complex economic landscape with varying indicators across different sectors..