Swiss stocks exhibited minimal changes as the market anticipates critical monetary policy rate decisions from both the US and UK central banks this week, alongside other significant economic data releases. At the conclusion of Monday's trading session, the Swiss Market Index marked a slight increase of 0.06%.
Analysts at BofA Securities commented on the US outlook, stating, "We expect the [US Federal Reserve] to cut rates by 25bp and Powell likely to point to a slower pace of cuts thereafter. Moreover, the dot plot should show three cuts in 2025 and a higher neutral rate." They further predicted, "For inflation, we expect core PCE inflation to increase by 0.1% mom, leaving the annual rate at 2.8%." Turning to the UK, expectations are set for the Bank of England to decide 8-1 in favor of maintaining the rate at 4.75%, given the persistent nature of inflation.
BofA Securities noted, "Our terminal rate expectation is 3.50% for early 2026. We expect a 20bp rise in headline inflation to 2.5%, with services above the central bank's forecast at 5.0%." Domestically, Switzerland observed a slight dip in the monthly producer and import price index, falling by 0.6% in November, a decline sharper than the previous month's 0.3% and contrary to expectations of a 0.2% increase.
Year-on-year comparisons showed a decrease of 1.5% in producer and import prices. In the eurozone, the HCOB Flash Eurozone Composite PMI Output Index rose to a two-month high of 49.5 in December, improving from 48.3 in November, bolstered by an unchanged manufacturing PMI at 45.2 and a services PMI that increased to 51.4 from 49.5, according to early data from S&P Global and Hamburg Commercial Bank.
On the corporate side, Holcim (HOLN.SW) successfully concluded its share buyback program, which was launched in March, repurchasing up to 1 billion francs worth of shares. The company bought back 12,249,093 shares, which constitutes 2.1% of its share capital, at an average price of 81.64 francs per share.
The repurchased shares are set to be canceled, which will reduce Holcim's share capital. At the end of the trading session, the stock reflected a downturn of 0.80%. Additionally, Xlife Sciences (XLS.SW) closed with no change after announcing plans for the listing of its Switzerland-based subsidiary Veraxa Biotech on the Nasdaq Stock Market in the US in fiscal 2025..