The Swiss equity market slipped on Monday as heavyweight pharmaceutical stocks weighed on the broader benchmark, while Nestlé advanced and biotech shares came under pressure.
The Swiss Market Index (SMI) declined 0.25% to 14,423 points, while the broader Swiss Performance Index (SPI) fell 0.2% to 20,276. Roche dropped 1.1% and Novartis slipped 0.9%, contributing to the index’s decline. Both stocks had outperformed the broader market in the prior week. Nestlé was among the few gainers, rising 0.5%, alongside gains in Richemont (+0.8%), Geberit (+0.6%), and Sika (+0.3%). Analyst support for Geberit from Citigroup and for Sika from UBS provided modest tailwinds.
The broader market saw Vetropack surge 5.8% following its half-year results, while DocMorris gained 2.9% after Deutsche Bank raised its price target and maintained a Buy rating. Biotech names such as Santhera (-2.6%), Idorisa (-2.3%), Basilea (-1.9%), Kuros (-1.8%), and Newron (-1.4%) lagged.
Market sentiment remained fragile ahead of key events, including U.S. Treasury Secretary Scott Bessent’s scheduled remarks on Monday evening regarding newly announced sanctions against Iran, expected to be the "harshest in history" and targeting the Iranian government. Analysts noted uncertainty over potential secondary sanctions and their potential impact on U.S.-China trade relations. Brent crude oil held near $93 per barrel, reflecting elevated geopolitical risk premiums.
The SMI was down 0.15% at 14,434 points in pre-market trading at Julius Bär, with 18 of 20 index components declining. Roche and Novartis again weighed on the index, while construction-linked stocks Holcim (+0.7%) and Geberit (+0.6%) provided support.
In Europe, the DAX was expected to open little changed, following a 0.6% gain on Friday to close at 26,136 points. U.S. equity benchmarks also showed signs of stabilization after a weak prior week, though concerns over fiscal deficits, elevated oil prices, and rising bond yields capped gains.
Gold prices rose 0.75% to $4,637 per troy ounce, the highest level in over three months, as the U.S. Treasury’s intervention in bond markets fueled dollar weakness and drove investors toward safe-haven assets. The Swiss franc strengthened slightly against the dollar, trading at 0.8000 CHF per USD, while the euro fetched 0.9345 CHF.
Asian equities showed caution to start the week. Japan’s Nikkei 225 was nearly flat at 65,968.71, while the Topix edged up 0.3% to 4,080.30. In China, the Shanghai Composite fell 0.6% to 3,880.33, and the Shenzhen Component Index declined 1.1% to 4,566.57.
In South Korea, Samsung Electronics slumped 8% after its $79 billion capital return program disappointed investors, while SK Hynix rose 0.4%. Analysts cited the absence of a share buyback plan as a key disappointment for Samsung. Broader concerns over inflation and expectations of a Bank of Japan rate hike in September also weighed on sentiment.
The dollar traded slightly lower against the yen at 158.87 JPY and the yuan at 6.7235 CNY, while holding steady at 0.8000 CHF. The euro was little changed at 1.1681 USD and slipped 0.1% to 0.9345 CHF. The Canadian dollar also came under mild pressure ahead of potential trade measures from the U.S.
Oil prices retreated on Monday, with Brent crude down 1.5% to $92.94 per barrel and WTI falling 1.7% to $85.61, paring strong gains from the prior week as traders awaited further clarity from Bessent’s remarks on U.S. sanctions policy.
