The European Central Bank raised its key interest rate by a quarter percentage point but signalled it might soon pause its yearlong campaign of rate increases, sending the euro tumbling. The ECB's rate increase, its ninth in a row, took the bank's deposit rate to a 22-year high of 3.75% from below zero a year ago. It echoed a quarter-point raise by the Federal Reserve a day earlier, though eurozone rates remain clearly below the Fed's benchmark rate of 5.25% to 5.5%. The ECB's signaling underlines the dilemma it faces compared with the Fed. Inflation is higher in the eurozone than in the U.S., and growth is much weaker, partly reflecting the shock of Russia's war in neighboring Ukraine. The ECB needs to balance the risk that inflation stays too high for too long against the looming threat of recession, which has stalked the bloc for months. ECB President Christine Lagarde acknowledged at a news conference that the outlook for the eurozone economy had deteriorated, particularly in the manufacturing sector. While the U.S. economy is growing robustly, the eurozone has been stalling since the end of last year. Business surveys point to more pain ahead, especially in Germany, the currency area's largest economy.

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The Swiss stock market ended Thursday's trading session with a substantial gain. The SMI improved by 1.7 per cent to 11,373 points. Among the 20 SMI stocks, there were 19 price gainers and one price loser. 22.91 (previously: 16.23) million shares were traded. Traders were satisfied with Nestle's financial figures (+2.6%): expectations were slightly exceeded, especially in terms of sales. However, looking further into the balance sheet, sales were driven only by higher margins, as was the case earlier at Unilever, traders commented. Volume, on the other hand, fell slightly. Roche shares were up 0.5 per cent. The group's sales, EBIT and earnings per share were roughly in line with market expectations after a solid second quarter. Holcim shares rose by 3.5 per cent. The cement manufacturer increased both sales and results organically in the second quarter thanks to strong growth in North America. The operating margin improved to a record level. Holcim maintained its outlook for the full year.

European equities posted solid gains on Thursday, with investors hoping that monetary tightening will soon be completed following meetings of the US and European central banks. The Stoxx Europe 600 index gained 1.4% to 471.7 points. In Paris, the CAC 40 and SBF 120 rose by 2.1% to 7,465.24 points and 1.9% to 5,694.87 points respectively. The DAX 40 in Frankfurt advanced by 1.7% and the FTSE 100 in London climbed by 0.2%. Teleperformance (-16.9%) was the biggest underperformer of the CAC 40 as the call centre operator again lowered its sales growth target for 2023. Nexity (-12.6%) also cut its financial forecasts for this year and warned that it would revise its targets beyond that. Eramet (-9.3%) reduced its adjusted EBITDA target for 2023, stating that the "rebound initially anticipated in China has not yet materialised". Forvia fell by 4.4% as inflationary pressures hampered the automotive supplier's financial performance in the first half of the year and created uncertainty for the months ahead. Sopra Steria (+11.9%) has raised its sales target for 2023. Saint-Gobain (+4.6%) announced an increase in its operating margin target for this year, supported by its price increases. Seb (+2.7%) returned to growth in the second quarter and raised its targets for the current year. Barclays (-5.1% in London) posted one of the steepest declines among the FTSE 100 indexes. The British bank has revised downwards its net interest margin forecast for Barclays UK, the branch which groups its retail banking activities in the UK, in 2023. Volkswagen (-1.2% in Frankfurt) announced a dip in second-quarter profit after tax and lowered its vehicle delivery target for the full year 2023, due to ongoing supply chain tensions.

The Dow Jones Industrial Average fell Thursday, ending a streak of 13 consecutive winning sessions. The Dow’s run of gains was the longest since 1987 and the second-longest on record. The blue-chip index fell 237 points on Thursday, or 0.7%. The S&P 500 fell 0.6%, while the tech-heavy Nasdaq Composite dropped 0.5%. Stocks were in the green for much of the session, losing steam in the afternoon. The economic data has been accompanied by solid corporate earnings from big companies in key sectors. Meta Platforms shares rose 4.4% Thursday after reporting its highest quarterly sales growth since 2021. McDonald’s gained 1.2% on stronger-than-expected sales and profit, while shares of Invisalign maker Align Technology advanced 13%. Royal Caribbean Group gained 8.7%. Southwest Airlines fell 8.9% after the carrier said it would revamp its flight schedule. Overall, second-quarter profits from S&P 500 companies are down about 8% from a year ago, according to a blend of reported results and consensus estimates. However, 80% of companies have so far topped Wall Street profit expectations, a slightly higher rate than average. About 44% of S&P 500 companies have reported as of Thursday morning, according to FactSet.

Asian stocks were mixed on Friday. The focus is on the interest rate decision of the Japanese central bank. The central bank left the key interest rate and the target yield for ten-year government bonds unchanged. On the Tokyo stock exchange, the Nikkei 225 index falls by 2.3 per cent. Among the individual stocks in Tokyo, Canon dropped by 5 per cent after presenting disappointing business figures. Fujitsu declined by 5.1 per cent; the company reported a 75 per cent slump in profits. Meanwhile, the Chinese stock markets are trading on the upside. Here, hopes of further economic stimuli are supporting. In Shanghai, the Composite Index advanced by 1.4 per cent, the Hang Seng Index in Hong Kong was up 0.9 per cent. The Kospi in Seoul loses 0.4 per cent.

Treasury yields jumped on Thursday, pushing the 30-year rate to its highest level since November, after U.S. data pointed to a still-resilient economy and a report that the Bank of Japan may tweak its yield-curve control policy. The 10-year Treasury note yield jumped by almost 14 basis points to 4.000%. The 2-year Treasury note yield advanced by 6 basis points to 4.916%.

Price target Kuehne+Nagel: Barclays upgrades to CHF 245 (230) - Underweight

Target price Sulzer: Julius Baer lifts to CHF 83 (79) - Hold

Target price Givaudan: Baader Helvea lowers to CHF 3100 (3200) - Add

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