SMI rises sharply after surprising SNB interest rate move, franc falls
Published: Thursday, Mar 21st 2024, 11:22
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On Thursday, the Swiss stock market significantly extended its gains from the initial phase following the SNB's interest rate decision. The SNB had previously surprisingly lowered key interest rates in Switzerland by a quarter of a percentage point.
Even though individual analysts had not ruled out a surprise from the SNB in advance, the majority of economists still expected the first interest rate cut to wait until June.
Bank Lombard Odier, for example, now expects further interest rate cuts this year. It describes the SNB's unexpected move as an "ideal farewell gift from Thomas Jordan, who can now clearly set the direction for his successor".
The US Federal Reserve had already created a positive mood following its interest rate decision the previous evening. As expected, interest rates have not yet been cut. However, the prospect of an imminent start to the interest rate cut path remains intact. The analyst community continues to expect a first cut in June and anticipates a total of three interest rate cuts for the year as a whole.
The SMI currently stands at 11,761 points, 1.24 percent higher than at the close of trading on Wednesday. At the same time, the Swiss franc has weakened significantly. The US dollar is currently trading at CHF 0.8953, compared with CHF 0.8870 before the SNB's announcement. The euro is currently trading at 0.9765, compared with 0.9682 previously.
The most popular blue chips on the local stock exchange are VAT (+4.8%), SIG (+4.1%) and Swatch (+3.8%). Swatch confirmed its current strategy ahead of today's annual media conference. Accordingly, the creation of jobs in Switzerland remains a priority.
Roche's non-voting equity securities bucked the trend and fell 0.7 percent, held back by a study on a drug that did not quite meet analysts' expectations.
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