The Swiss Market Index witnessed a decline of 1.02% at Friday's close as investors carefully digest the latest US job figures and the diminishing consumer confidence in Switzerland. This downturn comes amid an essential evaluation of the US labor market data, which revealed that the economy added 142,000 jobs in August.
This figure represents an increase from the downwardly revised count of 89,000 jobs in July, albeit falling short of the consensus expectations that forecasted 160,000 job creations. In contrast, the unemployment rate saw a slight decline to 4.2%, down from 4.3%, aligning with market expectations. In their analysis, ING commented, "The jobs report provides a real mix of numbers that does little to resolve the debate over whether the Fed will cut rates by 25bp or 50bp on 18 September.
We have a 50bp in our forecast, but it is a low conviction call made on the basis that fears regarding inflation have diminished and the Fed is likely to move preemptively in response to potential weaknesses in the labor market that we anticipate will become increasingly more pronounced in the forthcoming months." Turning to local matters, Switzerland's consumer sentiment index has reported a decline, now standing at -34.6 points in August, down from -32.4 points in July, according to data released by the State Secretariat for Economic Affairs.
The latest figures have revealed a growing pessimism among consumers regarding the economic landscape, even as expectations regarding their personal financial situations held steady compared to the previous month. In a related development, the Swiss National Bank (SNBN.SW) reported a reduction in its foreign currency reserves, which fell to 693.83 billion francs in August from the previous month's total of 703.66 billion francs, marking the fourth consecutive month of decline. In corporate news, Berenberg has reaffirmed its hold recommendation for Roche's stock ($ROG), maintaining its price target at 290 francs.
This decision comes especially as the pharmaceutical group's valuation discount has begun to ease due to recent improvements in its product pipeline. Nonetheless, shares of Roche dipped 0.72% by the end of trading. Conversely, Basilea Pharmaceutica (BSLN.SW) experienced a boost, with its stock climbing 1.57% after the company disclosed that it is poised to receive a $25 million milestone payment following the impressive sales of its antifungal medication, Cresemba, in Europe, facilitated by its licensing agreement with Pfizer..