Swiss Stocks Fall on Central Bank's Surprise

Stocks in Switzerland fall the most in 25 years, led by the nation’s exporters, unexpectedly ended its minimum exchange rate.The Swiss Market Index slid 8.7 percent at the close of trading in Zurich, after earlier losing as much as 14 percent. The Euro Stoxx 50 advanced 2.2 percent to 3,157.36. Italy’s FTSE MIB Index surged 2.4 percent, while Germany’s DAX Index jumped 2.2 percent to cross the 10,000-point mark. The Swiss franc rallied, briefly causing several indexes priced in euros to surge as Swiss companies reflected the jump.

The SNB’s decision comes just one week before European Central Bank policy makers meet to discuss introducing new stimulus, including quantitative easing, a move that may add to pressure on the franc against the euro.Swiss exporters slid as the franc jumped to a record against the euro and surged as much as 27 percent versus the dollar. Watchmakers Cie. Financiere Richemont (CFR) and Swatch Group AG, which get the majority of their revenue from outside the nation, plunged more than 15 percent. Holcim Ltd., the world’s biggest cement maker, dropped 11 percent.

Swiss banks and financial companies also retreated. UBS Group AG sank 12 percent, while Credit Suisse Group AG slumped 11 percent. Julius Bear Group Ltd. slid 11 percent. Before today’s decision by the SNB, analysts at JPMorgan Chase & Co. said in a note that UBS, Switzerland’s largest bank, would be among lenders benefiting from an appreciating dollar. Among stocks rising today, Total SA was among the biggest gainers on the Euro Stoxx 50, climbing 2.8 percent, as energy companies rebounded. Consumer companies also advanced, with Unilever rising 3.7 percent and Anheuser-Busch InBev NV increasing 3.1 percent.