Trump euphoria quickly fades on the Swiss stock market
Published: Wednesday, Nov 6th 2024, 19:20
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Donald Trump's clear election victory initially sent prices on the Swiss stock market soaring on Wednesday. However, the euphoria did not last long and the leading SMI index even closed slightly below the previous day's close.
The joy that a close result in Washington and the feared hangover did not materialize did not last long, traders said. There was profit-taking in the course of the day. Trading was similar on other major European stock exchanges, while the US indices showed strong gains (Dow Jones Industrial: around +3 percent).
It is a realistic scenario that Europe could be a loser of the policies of the new US President Trump, stock market analysts explained this discrepancy. "Trump sees the European Union as a rival rather than an ally in the geo-economic struggle," said one economist, summarizing the mood.
There is therefore a considerable probability that conflicts will arise in trade policy and in dealings with Russia. "This is likely to create uncertainty and affect economic sentiment in Europe," the expert continued.
Logitech the biggest loser
The Swiss benchmark index SMI ultimately closed 0.2 percent lower at 11,847.29 points. It had risen to over 12,100 points at times in early trading, but then slipped to almost 11,821 points in the afternoon. The broad SPI fell by 0.2 percent to 15,776.36 points.
There was a wide range of swings among the blue chips. They ranged from -5.5 percent (Logitech) to +5.2 percent (UBS).
Traders attributed Logitech's heavy losses to the fact that the computer and consumer electronics manufacturer could be particularly affected by distortions in international trade and US tariffs. The same applied to other main losers such as SGS and Kühne+Nagel, which fell by 4.7 and 2.5 percent respectively.
In addition to UBS, other financial representatives were also among the winners. According to traders, financial groups are expected to be among the beneficiaries of the second Trump era - as the Republicans are in favor of deregulation.
Infrastructure stocks such as ABB (+1.5 percent) and Holcim (+1.6 percent), which could benefit from the new US government's investment programs, were also in demand.
Swissquote driven by crypto hopes
On the broad market, Swissquote (+8.0%) was a beneficiary of Trump's victory. Investors were betting on a potential crypto boom under the new president, according to reports.
Gurit and Meyer Burger, whose wind turbine elements and solar cells are unlikely to be in the Trump administration's favor, fell by a steep 9.5 and 7.5 percent respectively. This is because Trump denies climate change and wants to boost the oil industry.
©Keystone/SDA
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