China's benchmark lending rate was lowered by a smaller-than-expected margin on Monday, after the central bank cut its key policy rates last week to offer more support for the slowing economy. The one-year loan prime rate was lowered by 10 basis points to 3.45% while the five-year LPR was held at 4.2%, the People's Bank of China said. The PBOC cut the interest rate of the one-year medium-term lending facility by 15 basis points to 2.5% last week. The MLF rates are used in China to price the benchmark LPR, prompting expectations for cut of more than 10 basis points. The smaller reduction in LPR may reflect Chinese lenders' reluctance to reduce their lending rates as they face narrowing profit margins. The benchmark rate was set by using quotations from a group of Chinese lenders that price their prime loans to clients based on PBOC's MLF rates. The rate cut came after the Chinese economy slowed across the board in July.

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The Switzerland stock market ended weak on Friday amid lingering worries about slowing growth and higher interest rates. The benchmark SMI, which stayed in negative territory right through the day's session, settled with a loss of 45.83 points or 0.42% at 10,839.06. The index touched a low of 10,749.38 and a high of 10,870.27 intraday. Richemont, Sika and Roche Holding lost 1.41%, 1.24% and 1.12%, respectively. Sonova, Givaudan, UBS Group, Swiss Re, Kuehne & Nagel and Novartis ended lower by 0.5 to 0.9%. Zurich Insurance Group and Swiss Life Holding also closed weak. Nestle gained 0.54%. Geberit, Swisscom and ABB posted modest gains. In the Mid Price Index, Meyer Burger Tech lost more than 4%. Dufry ended 2.08% down, while Julius Baer, Galenica Sante, Flughafen Zurich, Clariant and Ems Chemie Holding shed 0.9 to 1.2%. DocMorris soared nearly 11%. Tecan Group and VAT Group gained 1.6% and 1.12%, respectively. PSP Swiss Property advanced 0.87%. Provisional data from the Federal Statistical Office showed Switzerland's industrial production declined in the second quarter amid contractions in both mining and quarrying and manufacturing output. Industrial production dropped 0.8% year-over-year in the second quarter, reversing a 4.2% growth in the first quarter. Further, this was the first decrease since the first quarter of 2021.

European stocks closed lower on Friday as growth worries and concerns about monetary tightening continued to deter investors from indulging any significant buying, and look to lighten positions instead. In addition to assessing the likely interest rate-path of central banks, investors also digested the latest batch of economic data from Europe and the U.S. The pan European Stoxx 600 declined 0.61%. The U.K.'s FTSE 100 and Germany's DAX both dropped 0.65%, and France's CAC 40 ended down 0.38%, while Switzerland's SMI ended lower by 0.42%. The U.K.'s FTSE 100 posted a weekly loss of about 3.3%. DAX shed about 2% in the week, the CAC 40 dropped 2.4%, and the pan European Stoxx 600 drifted down 1.5%. Among other markets in Europe, Austria, Belgium, Denmark, Finland, Greece, Netherlands, Norway, Poland, Spain, Sweden and Turkiye closed weak. Czech Republic, Ireland and Russia ended higher, while Iceland and Portugal settled flat. In the UK market, Airtel Africa ended 4.4% down. RS Group, Antofagasta, Prudential, JD Sports Fashion, ABRDN, Frasers Group, Weir Group and Hiscox ended lower by 2 to 3.5%. Ashtead Group, Smurfit Kappa Group, Anglo American Plc, Glencore, Hargreaves Lansdown, Burberry Group, Standard Chartered, Melrose Industries, HSBC Holdings, CRH and AstraZeneca lost 1.2 to 2%. British American Tobacco climbed 1.53%, and Tesco gained 1.3%. WPP and BAE Systems also closed notably higher. In the German market, Sartorius and Zalando both shed about 3.7%.

Major U.S. stock indexes shed more than 2% this week, deepening their August slump, while Treasury yields touched their highest levels in years. U.S. government bond yields on Friday fell back from Thursday's multiyear highs, but remained lofty enough to make investors think twice about betting on stocks to maintain this year's surprising rally. The Nasdaq, packed with rate-sensitive technology stocks, fell 0.2% on Friday. The Dow Jones Industrial Average rose about 26 points, less than 0.1%, while the S&P 500 declined less than 0.1%. Every segment of the S&P 500 ended the week lower. Keysight Technologies, which makes electronic test and measurement equipment such as oscilloscopes and digital multimeters, dropped 14%. Deere & Co. fell 5.3%. Mounting concern over China's economy is one worry for Deere shareholders, while analysts noted that the company's increased financial guidance was mainly because of a favorable tax ruling in Brazil. Cosmetics giant Estée Lauder, which shed 3.3% Friday, chalked up its quarterly loss to declining sales in China. Ross Stores was the S&P 500's top gainer. The discount retailer rose 5% after posting better-than-expected earnings and boosting its second-half sales and profit outlooks after Thursday's closing bell. Cheaper ocean freight is helping margins and lower inflation is giving its low- to moderate-income customers more to spend, executives said.

The East Asian stock markets show a mixed trend at the beginning of the week. While Tokyo (+0.7% to 31,681 points) and Seoul (+0.6%) recovered slightly from their recent losses, the indices in Shanghai (-0.4%) and Hong Kong (-1.4%) fell again. Here, the uncertainties surrounding the weak economy in China continue to weigh. The fact that the People's Bank of China (PBoC) has lowered one of its reference rates for bank loans (LPR) to companies and households is not supportive, especially since the cut was less than expected. The one-year loan prime rate (LPR) was lowered to 3.45 (3.55) per cent.

The U.S. 10-year Treasury yield declined to 4.251%, from 4.307% on Thursday, which was the highest closing level since 2007. The 30-year Treasury yield was 4.379%, down from Thursday's 12-year high of 4.411%. Bills from one-month to one-year are paying more than 5%

UBS lowers Geberit to CHF 530 (550) – Buy

Deutsche Bank lowers Adyen to EUR 1,325 (1,750) – Buy

Deutsche Bank raises Scout24 to EUR 77 (75) – Buy

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