Swiss Market Stalls as Trade Surplus Growth Clashes with Watch Export Slump

The Swiss Market Index (SMI) concluded Thursday's session virtually unchanged, closing at 11,230.43 after a marginal loss of 1.40 points. The index experienced volatility throughout the day, peaking at 11,281.46 in early trades before dipping to a low of 11,173.64 in the late afternoon. ABB emerged as a primary driver of gains, rallying 6.3% following reports of higher Operational EBITA for the first quarter and positive guidance for accelerated revenue growth in 2024. Other notable gainers included Sika, Givaudan, and UBS Group, which each saw increases between 0.6% and 0.8%. Conversely, the market saw significant pullbacks in other sectors. Partners Group fell 3.26%, while luxury and healthcare players Richemont and Lonza Group dropped 2.5% and 2.34%, respectively. In the Mid Price Index, Barry Callebaut rallied 4.3%, while Sandoz and Adecco climbed 2.3% and 2.25% respectively. On the macroeconomic front, data from the Federal Customs Administration revealed a widening trade surplus, which grew to CHF 8.6 billion in the first quarter, up from CHF 8.1 billion in the final quarter of 2023. In real terms, exports rebounded by 0.6%. However, the luxury watch sector faced significant headwinds. Reports from the Federation of the Swiss Watch Industry showed that watch exports plummeted 16.1% year-over-year in March to CHF 2.0 billion, resulting in a 6.3% decrease for the first quarter overall.