The Swiss Stock Market Dropped On Fed Rate Hike Concerns

(RTTNews) - The Swiss stock market ended Friday's session firmly in negative territory. After fluctuating between small gains and losses during the first half of the session, the market turned definitively to the downside after the open on Wall Street. There were a number of factors that drove the market lower at the end of the week, but the main one were comments from Boston Federal Reserve President Eric Rosengren.

Rosengren said gradual tightening of monetary policy is likely to be appropriate to ensure the U.S. economy remains at the full employment level it is now approaching. Rosengren added that "a failure to continue on the path of gradual removal of accommodation could shorten, rather than lengthen, the duration of this recovery."

Geopolitical concerns also weighed on investor sentiment after North Korea confirmed its most powerful nuclear test to date. Lingering disappointment over the European Central Bank's inaction yesterday also soured the mood among traders.

The Swiss Market Index decreased 0.61 percent Friday and finished at 8,264.13. The SMI ended the trading week with an overall loss of 0.4 percent. The Swiss Leader Index dropped 0.63 percent Friday and the Swiss Performance Index fell 0.65 percent.

Cyclical stocks were under the most pressure, due to their economically sensitive nature. LafargeHolcim was the weakest performer, falling 3.2 percent. Geberit dropped 2.6 percent, while Clariant and Galenica surrendered 2.0 percent each. Givaudan weakened by 1.9 percent and Actelion lost 1.8 percent.

Shares of SGS also declined 2.2 percent. Morgan Stanley downgraded its rating on the stock to "Underweight."

The weak performance of the pharmaceutical heavyweights also pressured the overall market. Roche decreased 1.1 percent and Novartis forfeited 0.8 percent. Shares of Nestle also slipped 0.3 percent, despite receiving a "Buy" rating from Deutsche Bank.

Financial stocks were again among the best performers. Credit Suisse climbed 2.5 percent and UBS advanced 1.6 percent. Swiss Life gained 0.8 percent and Zurich Insurance added 0.4 percent.

However, shares of Swiss Re dropped 1.1 percent after Barclays downgraded its rating on the stock to "Underweight."