On Tuesday, Swiss equities faced a regional pullback in Europe as companies report their quarterly results and markets prepare for the upcoming UK Budget announcement. The Swiss Market Index concluded the day down by 1.12%. The highly anticipated first budget of Prime Minister Keir Starmer's Labour government is set to be unveiled on Wednesday by Chancellor of the Exchequer Rachel Reeves.
Analysts predict politically unpopular tax increases amidst an already pressing tax burden. In corporate developments, the Swiss pharmaceutical giant Novartis ($NOVN) announced a significant increase in its third-quarter net income, soaring to $3.19 billion from the previous year’s $1.51 billion.
This growth was complemented by an uptick in net sales during the same period. For the fiscal year 2024, Novartis is projecting low double-digit increases in net sales, a revision from earlier forecasts of high single to low double-digit growth. Nevertheless, shares dipped by 4.08% by market close. Analysts from Barclays remarked, "As expected, another robust quarter from Novartis, where Sales/Core Operating Income and Core EPS all exceeded Barclays and comparative consensus forecasts.
Guidance for Sales and Core Operating Income has been adjusted to the high end of prior projections; the company anticipates the launches of Promacta and Tasigna gx in mid-2025." They further noted, "Cosentyx shone this quarter, outperforming expectations with a high single-digit percentage increase, predominantly driven by new product launches, especially with strong performance in HS.
Meanwhile, Kisqali and Kesimpta met expectations, and Entresto slightly missed." Other companies reporting quarterly results included packaging firm SIG Group ($SIGN), specialty chemical producer Clariant ($CLN), and the pharmaceutical company Idorsia ($IDIA). In some less favorable news, Baloise ($BALN) experienced a decline of 3.83% after disclosing plans to divest its digital insurance portfolios from Germany and France to Allianz.
This transaction, which will finalize in mid-2025, will reportedly have a one-time negative earnings impact of 75 million Swiss francs in 2024. Overall, the Swiss market is navigating through a season marked by earnings announcements and significant fiscal implications ahead..