Monday, 1 July 2024 Reading time : 3 minutes

With the first half of the year behind us, it is time to pause and take a look at the Swiss equity market. The overall market, as measured by the SPI, rose by around 9.3% (total return as at 28 June). The SMI, which includes the twenty largest Swiss stocks, performed even better (+11.0%). Lonza and ABB are leading the index, with both up more than 30% in the first half of the year.

Lonza has started the new year with a lot of momentum after its share price almost halved last year. The pharmaceutical company is currently trading at CHF 490.00, the same level as last September. The story is quite different for ABB: the shares of the electrical engineering group have risen steadily since October, reaching an all-time high of CHF 51.52 after the publication of its quarterly results in April. They are currently trading just below this level at around CHF 50.00.

Givaudan, Alcon, Richemont and Holcim were also in demand in the first half of the year, each gaining more than 20%.

Five SMI stocks were in the red after the first semester, with the logistics company Kuehne + Nagel the worst performer (-7.3%). The group disappointed with its quarterly earnings in March and saw its share price fall by up to 20% as a result. Although they have recovered some of their losses, investors remain cautious.

Building materials producer Sika (-4.9%) and private equity company Partners Group (-1.9%) are also among the laggards in the SMI.

The first half of the year has been encouraging for the Swiss stock market. However, the SMI still lags behind by international standards. The S&P 500 blue-chip index has posted a total return of 15.2% since the beginning of the year. The ongoing AI boom has contributed to this, with chipmaker Nvidia's shares soaring almost 150%.

Investment ideas
The Barrier Reverse Convertible on Kuehne + Nagel, Sika and Partners Group offers an investment opportunity for investors looking to play the laggards in the SMI. The BRC has a barrier of 75% and pays a guaranteed coupon of 11.0% p.a. at maturity.
Termsheet (Valor: 135803650)

The Barrier Reverse Convertible on Lonza, ABB and Givaudan offers an investment opportunity for investors wishing to play the winners in the SMI. The BRC has a barrier of 75% and pays a guaranteed coupon of 12.0% p.a. at maturity.
Termsheet (Valor: 135803652)

Indicative terms

 

Disclaimer

This communication is for marketing purposes. It is neither an offer nor an invitation to submit an offer, to purchase or to subscribe to securities and does not constitute investment advice. You should consult your advisors before making an investment decision. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, financial condition, development or performance of the issuer to be materially different from any future results, financial condition, development or performance expressed or implied by such statements. The present document has not been drawn up by the research department as defined in the rules of the “Directives on the Independence of Financial Research” published by the Swiss Bankers Association, hence these rules do not apply to this document. If securities are mentioned in the communication, the base prospectus, the final terms and any key information document may be obtained free of charge from Zürcher Kantonalbank, Bahnhofstrasse 9, 8001 Zurich, VRIS, and from www.zkb.ch/finanzinformationen.