One of the drug industry’s most prolific dealmakers is striking again to revive eye-care company Bausch + Lomb. The company said it will pay $1.75 billion to acquire a dry-eye drug from Novartis, the first big move by Chief Executive Brent Saunders since he returned to the helm in March. The acquisition heralds Saunders’s return to mergers-and-acquisitions territory, which catapulted him up the ranks of pharmaceutical industry chieftains before costing him his job. Saunders previously led Bausch + Lomb from 2010 to 2013 before its sale to Valeant Pharmaceuticals International for $8.7 billion in 2013. Then, from his perch helming Forest Laboratories, he used a series of deals, including one for Botox maker Allergan for $66 billion in 2015, to build the company into one of the industry’s biggest. He served as chief executive of Allergan until it was acquired by AbbVie in 2020 for $63 billion. At Bausch, in Vaughan, Ontario, Saunders must find new growth at a company whose $3.8 billion in revenue last year was relatively flat from the prior year. The acquisition of Xiidra expands Bausch’s presence in the lucrative and growing market for dry eye.

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On Friday, the SMI gained 1 per cent to 11,280 points. Among the 20 SMI stocks, 19 rose and one fell. 24.48 million shares were traded (15.16 million). Leading the market were cyclical stocks such as ABB (+2.1%), Geberit (+1.8%) and Sika (+3.5%), but also more defensive stocks such as Givaudan (+2%) and Lonza (+2%). Roche (+0.1%) underperformed the broad market. Nestle gained 0.6%. Over the past six months, the SMI has risen by more than 5%. The best performers in the first half of the year were the technology stocks VAT and Temenos, the growth stock Straumann, the luxury goods manufacturer Richemont and the cyclical stocks Kühne+Nagel and Schindler, with gains ranging from 45% to 20%. These are stocks that had also lost 20 per cent or more in the previous year. At the bottom of the half-year rankings are Roche (down 6 percent), technology stocks Logitech (down 7.9 percent) and Osram (down 5.3 percent), companies with "problems of their own", as one trader put it. Adecco (-4.9%) was weighed down by economic concerns, according to one trader.

European stocks traded higher on Friday following inflation data from the eurozone which fell more than expected, though the core rate rose, complicating the task of the European Central Bank as it considers how much further its hiking cycle has to go. The Stoxx Europe 600 was up 1.2% at 461.9 points. In Paris, the CAC 40 and SBF 120 were up 1.2% and 1.1% respectively. In Frankfurt, the DAX 40 added 1.3% and in London the FTSE 100 climbed 0.8%. For the week as a whole, the Stoxx Europe 600 increased by 1.9%. European aerospace and defence group Airbus (+1.3%) announced on Friday that it had received certification from the US Federal Aviation Administration (FAA) for its H160 helicopter. Retail group Carrefour (+1.3%) reprted on Friday that it had completed the sale of its 60% stake in its Taiwanese subsidiary to local player Uni-President for €1 billion. Sodexo (-1%) on Friday revealed organic revenue growth of 10.5% in the third quarter of its 2022-2023 financial year, which ends at the end of August, and refined its targets for the year.

The New York Stock Exchange closed higher on Friday after further signs of slowing inflation in the United States, which could limit the need for further interest rate hikes. The Dow Jones Industrial Average (DJIA) gained 0.8% to 34,407.60 points, while the broader S&P 500 index added 1.2% to 4,450.38 points. The Nasdaq Composite climbed 1.4% to 13,787.92 points. The PCE index measuring prices linked to US consumer spending, the Federal Reserve's preferred indicator of inflation, rose by 3.8% year-on-year and 0.1% month-on-month in May, following an increase of 4.3% year-on-year and 0.4% month-on-month in April, announced the US Commerce Department. On Friday, Apple became the first US company to reach a closing capitalisation of more than $3,000 billion. The stock gained 2.3% to $193.97 after Citigroup raised its recommendation on the stock to "buy" and its target price to $240. Sports equipment maker Nike (-2.7%) reported lower-than-expected results for the last quarter due to weaker demand amid higher prices. Tesla climbed 1.7% ahead of Sunday's publication of its second-quarter sales. Tesla’s global deliveries surged 83% in the second quarter, helped by sharp price cuts and hefty discounts as the electric-car maker chases growth in an increasingly competitive marketplace. Nvidia surged 3.6% to $423.02, as Daiwa raised its recommendation on the stock to „safe".

In Asia, major indexes broadly closed with gains on Monday. In Tokyo, the Nikkei 225 index rose by 1.6 per cent to a 33-year high, additionally supported by the Bank of Japan's (BoJ) quarterly Tankan report, indicating an upturn in the business climate among the Japanese large-scale industry, which also turned out better than expected. Meanwhile, the Caixin manufacturing purchasing managers' index in China fell slightly in June, albeit remaining in expansionary territory. Nevertheless, these economic indicators fuel hopes for further stimulus from China's central bank. In Shanghai, the composite index rose by 1.3 per cent. The Hang Seng Index in Hong Kong advanced by 1.7 per cent. The Kospi in Seoul surged 1.5 per cent.

Two- and 10-year U.S. Treasury yields finished mixed on Friday, but ended the week higher, after the Federal Reserve’s favorite U.S. inflation gauge included some signs of easing along with stubborn core readings for May. The 10-year Treasury note yield fell by 5 basis points to 3.801%. The 2-year Treasury note yield remained stable at 4.866%.

Target price Swatch: Credit Suisse upgrades to CHF 200 (180) - Underperform

Target price Richemont: Stifel lifts to CHF 175 (173) - Buy

Romande Energie target price: Baader Helvea downgrades to CHF 60 after stock split - Buy

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