Zurich Insurance has claimed effective control of its Indian counterpart Kotak General Insurance. The Zurich-based insurer is thus putting into practice the agreement reached last November. The Swiss multinational paid 670 million dollars, or around 592 million Swiss francs, to acquire 70% of Kotak's capital, it stated in a press release on Wednesday. The declaration of intent at the beginning of November 2023 involved a 51% stake for USD 488 million, with an option for an additional 19%. It remained subject to the approval of the Central Bank of India, as well as that of the insurance and development regulators on the sub-continent, which Zurich Insurance claims to have now obtained. Together, the two companies will form a leading global insurance company, combining Zurich Insurance's dominant position with Kotak's local expertise in one of India's most important growth markets. Zurich Insurance boasts of becoming the first foreign insurer to enter the Indian market since a legislative adjustment allowed it to acquire up to 74% of a local insurer. On the Swiss stock exchange, Zurich Insurance closed up 0.6% at CHF 482.70, while the leading SMI index gained 0.1%.

The Swiss stock market closed slightly higher on Wednesday. Investors are likely to have held back ahead of the Swiss National Bank's interest rate decision on Thursday. The SMI gained 0.1 per cent to 12,060 points. Among the 20 SMI stocks, there were ten losers and ten gainers. A total of 13.98 (previously: 15.62) million shares were traded. Among individual stocks, Givaudan lost 1.1 per cent. However, the share has gained 26 per cent since the beginning of the year and thus significantly more than the SMI, which has risen by a good 8 per cent. Heavyweight Nestlé (-0.4 per cent) was once again shunned, while pharmaceutical stocks Novartis and Roche, which are also heavily weighted, recorded gains of 0.8 per cent each. Zurich Insurance advanced by 0.6 per cent. The company is buying a majority stake in the property insurance business of India's Kotak Mahindra Bank. Zurich is paying USD 670 million for a 70 per cent stake. UBS left the market in a strong position. Following an in-depth review, the Swiss financial supervisory authority Finma has concluded that the takeover of Credit Suisse by UBS does not eliminate effective competition on the Swiss banking market.

The European stock markets closed in the red on Wednesday, at the end of a lacklustre session marked by the absence of American investors due to a public holiday in the United States. The Stoxx Europe 600 index fell by 0.2% to 514.1 points. In Paris, the CAC 40 and SBF 120 lost 0.8% each. The DAX 40 was down 0.4% in Frankfurt, while the FTSE 100 gained 0.2% in London. Wall Street is closed on Wednesday for Juneteenth Day. In the UK, consumer prices rose by 2% year-on-year in May, following a 2.3% increase in April. Although overall inflation eased in the UK in May, it is the rise in services prices, which was stronger than expected for the second month running, which seems to be important to the Bank of England (BOE). At 5.7%, it is now 0.4 percentage points above the BOE's forecast, which is likely to leave rates unchanged at the BOE’s meeting on Thursday. Société Générale (-1.6%) has reached an exclusive agreement with Danish software developer Ageras to sell its online banking business for very small businesses, Shine. The amount of the transaction was not disclosed. Accor gained 1.5% to €38.44. On Wednesday, Barclays raised its recommendation on the hotel group from "neutral weighting" to "overweight", while upgrading its target price from €33 to €48. Getlink, formerly Groupe Eurotunnel, rose by 1.3% to €15.85. UBS raised its recommendation on the Channel Tunnel operator from "neutral" to "buy" and increased its target price from €17.70 to €18.50. According to the financial intermediary, the recent fall in the share price following the announcement of early parliamentary elections in France offers an interesting investment opportunity. British telecoms operator Vodafone (up 1.4% in London) announced on Wednesday that it had sold an 18% stake in Indus Towers, an Indian operator of telecoms towers, for 153 billion rupees, or 1.7 billion euros.

Markets ind the U.S. were closed for the Juneteenth holiday on Wednesday.

Asian indexes diverged for the Thursday trading session. There was a lack of impetus from Wall Street, where trading had been closed the previous day due to the Juneteenth holiday. In Tokyo, the Nikei 225 index fell by 0.5 per cent to 38,397 points, while in Shanghai and Hong Kong the market also slipped by up to 0.5 per cent. In Sydney, the trend is just about unchanged, while in Seoul, South Korea, it is well maintained. The interest rate decision by the Chinese central bank provided no impetus. As expected, it left its reference interest rate for bank loans (LPR) to companies and households unchanged. The one-year interest rate remains at 3.45 per cent and the five-year rate at 3.95 per cent. Both rates have been unchanged since February. The central bank is now considering using a short-term interest rate, such as the interest rate on seven-day reverse repo transactions, as a guide for the markets and as a key interest rate, the central bank indicated. Other monetary policy instruments could gradually fade into the background as key interest rates. Plans by the Securities Regulatory Commission to reform the Nasdaq-like technology exchange, the Star Market, are causing a stir in Shanghai. In Hong Kong, on the other hand, players are concerned about reports which, according to analysts at UOB, suggest that the Chinese authorities could soon introduce measures to encourage more investment from mainland investors in the Hong Kong stock market. In both cases, however, this has failed to boost share prices for the time being. Among individual stocks, SK Innovation jumped 16 per cent. According to media reports, the oil refinery and battery company wants to merge with its sister company SK E&S, specialising in renewable energies. According to participants, the state-owned utility Korea Gas (+4.7%) is buoyed by government plans for offshore gas production.

The Swiss bond market showed little movement on Wednesday. In view of a public holiday in the USA and the SNB's upcoming interest rate decision, trading was quiet. Meanwhile, the Banca dello Stato del Cantone Ticino, or Ticino KB for short, has raised CHF 200 million for 12 years. The yield to maturity was quoted by the issuing banks at 1.593%, with a spread (MS) of 42 basis points. Otherwise, the primary market has remained quiet for the moment. The Ticino KB is likely to be the last issue before the SNB's decision, as was already rumoured in trading the day before. The only other certainty is that the Pfandbriefzentrale will come to the market with an issue next Tuesday. The trend-setting Swiss Bond Index SBI is now trading slightly lower at 132.18%. The two-year benchmark Swiss Confederation bonds recently yielded 0.9357% and the ten-year bonds 0.7071%.

UBS lowers BASF target to EUR 58 (61) - Buy
Target price Givaudan: Berenberg raises target to CHF 3950 (3850) - Hold
UBS upgrades ING target to EUR 19.80 (18.30) - Buy
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