Swiss Market Ends On Firm Note After SNB Rate Cut Announcement

The Switzerland market ended on a bright note on Thursday with investors cheering the Swiss National Bank's decision to cut interest rate.

The benchmark SMI ended with a gain of 85.03 points or 0.73% at 11,703.66. The index touched a high of 11,779.24 in early trades.

The SNB became the first major central bank to ease the policy in the current cycle as the fight against inflation over the last two and a half years has been effective. The central bank, which unexpectedly lowered the policy rate by 25 basis points to 1.5%, said it remains willing to be active in the foreign exchange market as necessary.

SNB President Thomas Jordan said, "Our decision takes into account the significantly reduced inflationary pressure as well as the appreciation of the Swiss franc in real terms over the past year."

The policy rate cut supports economic activity and today's easing ensures that monetary conditions remain appropriate, the bank said.

"The SNB will continue to monitor the development of inflation closely, and will adjust its monetary policy again if necessary to ensure inflation remains within the range consistent with price stability over the medium term," the bank said.

The SNB downgraded inflation outlook for 2024 to 1.4% from 1.9%. Similarly, the projection for 2025 was trimmed to 1.2% from 1.6%. The central bank sees inflation at 1.1% in 2026.

Partners Group, the top gainer in the SMI, climbed 4.3%. Lonza Group and Sonova, both gained more than 2.6%. UBS Group ended higher by nearly 2.25%.

Sika, Novartis, Holcim, ABB and Kuehne & Nagel gained 1.6 to 2%. Alcon and Swiss Life Holding also ended notably higher.

Roche Holding ended down by 2.5%, and Zurich Insurance Group shed about 0.5%.

In the Mid Price Index, Meyer Burger Tech zoomed nearly 17%. ams OSRAM AG and VAT Group rallied 7.1% and 6.2%, respectively.

Julius Baer climbed about 4.4%. SIG Group, Straumann Holding, Clariant, Temenos Group, Swatch Group, SGS, Belimo Holding, Ems Chemie Holding, PSP Swiss Property and Adecco gained 1.5 to 3.6%.

Helvetia ended lower by about 4.65%. Sandoz, BKW and Schindler Holding shed 2.4% and 1.33% and 1.25%, respectively.

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