The Swiss National Bank (SNB) has once again posted a loss. Specifically, according to provisional calculations, the SNB is reporting a loss of around CHF 3 billion for 2023 as a whole. According to a statement on Tuesday, there was a profit of around CHF 4 billion on foreign currency positions, a valuation gain of CHF 1.7 billion on gold holdings and a loss of CHF 8.5 billion on Swiss franc positions. After nine months, the SNB had posted a plus of 1.7 billion, which was followed by a minus of around 4.7 billion in the fourth quarter. Due to the renewed loss, the distribution to the Confederation and cantons will once again be discontinued, as the SNB also announced. No dividend will be paid to shareholders either.

After a flat start and a subsequent fall to lower levels, the Swiss market recovered on Monday, and despite staying a bit sluggish till around mid afternoon, managed to end the day's session on a firm note. The benchmark SMI ended up 44.50 points or 0.4% at 11,230.40, recovering from a low of 11,124.02. Sonova climbed about 2.6%. Logitech International gained nearly 2%, while Alcon, Lonza Group and Swiss Life Holding ended higher by 1.2 to 1.6%. ABB, Swiss Re, Richemont, Partners Group and Givaudan also ended on a firm note. Kuehne & Nagel drifted down 2%. Swisscom and Sika ended lower by 0.39% and 0.35%, respectively. Temeons Group, down 3.8%, was the top gainer in the Mid Price Index. Meyer Burger Tech, Tecan Group and ams OSRAM AG gained 2.7%, 2.3% and 2.2%, respectively. Flughafen Zurich gained nearly 2%, while Lindt & Spruengli, VAT Group, BKW, Avolta, Straumann Holdings, Georg Fischer and Swatch Group advanced 0.8 to 1.4%. SGS ended down 3.3%, and Barry Callebaut ended nearly 2% down. Baloise Holding and Clariant closed modestly lower. Data from the Federal Statistical Office showed Switzerland's consumer price inflation increased more-than-expected in December. The consumer price index, or CPI, climbed 1.7% year-over-year in December, after a 1.4% gain in November, the data said. Economists had expected inflation to rise slightly to 1.5%. However, inflation remained within the central bank's target range of 0-2%.

Europe
European stocks closed higher on Monday after a cautious session, with investors looking ahead to the data on U.S. consumer price and producer price inflation for further clarity about the Federal Reserve's interest rate path. Stocks struggled earlier in the session amid persisting concerns about the tensions in the Middle East. Israel struck Hamas and Hezbollah terror facilities in Khan Yunis and Lebanon in overnight strikes, the Israel Defense Forces said earlier today. The pan European Stoxx 600 gained 0.38%. The U.K.'s FTSE 100 edged up 0.06% and Germany's DAX climbed 0.74%, while France's CAC 40 and Switzerland's SMI both gained 0.4%. Among other markets in Europe, Belgium, Finland, Greece, Iceland, Netherlands, Poland, Russia, Spain, Sweden and Turkiye closed higher. Austria, Denmark, Norway and Portugal ended weak. In the UK market, Melrose Industries rallied 4%. B&M European Value Retail, Legal & General, Smith & Nephew, Prudential, Rolls-Royce Holdings and Taylor Wimpey gained 2.5 to 3.1%. Centrica, Marks & Spencer, IMI, Auto Trader Group, Howden Joinery, Ocado Group, Airtel Africa and Rightmove also moved up sharply. Royal Dutch Shell dropped about 3%. BP ended 2.6% down, while Glencore, Endeavour, United Utilties and Anglo American Plc ended lower by 1 to 1.6%. In Germany, Siemens Energy climbed more than 5%. Qiagen gained about 2.7%, while Infineon, Adidas, Siemens Healthineers, Continental, Mercedes-Benz, Zalando and HeidelbergCement advanced 1.3 to 2%. Fresenius and Covestro both drifted down nearly 1.5%. RWE, Merck and Daimler Truck Holding also closed weak. In the French market, Airbus Group climbed 2.5%.

United States
U.S. stocks posted solid gains Monday, easing investor anxieties after the market’s rough start to 2024 last week. Both the S&P 500 and the Nasdaq Composite logged their best days since November, climbing 1.4% and 2.2%, respectively. Large technology companies were at the forefront of the rally, just as they were the major driver of last week’s declines and 2023’s gains. All of the so-called Magnificent Seven stocks climbed more than 1%, with chip maker Nvidia jumping 6.4%. In an otherwise encouraging day, Boeing shares were an exception, falling 8% after a 737 MAX jet was forced to make an emergency landing Friday when a piece of the plane ripped off in midair. That decline weighed on the Dow Jones Industrial Average, which rose 0.6%, or roughly 217 points. The S&P 500 fell 1.5% last week, prompting some mild concerns given how often the first week of January has set the tone for the rest of the year. Since 1950, the first five trading days of the year have predicted the direction of the S&P 500’s full-year return nearly 70% of the time, including in eight out of the past 12 years. Stocks and bonds have both been lifted in recent months by a substantial decline in inflation, which has led to bets that the Federal Reserve could cut interest rates by at least 1 percentage point this year. Bets on rate cuts could be tested later this week, when the Labor Department releases consumer-price-index data on Thursday and producer-price data on Friday. “A hotter than expected [CPI] number will be a very bad day for the bulls” because it could cause investors to question the outlook for rate cuts, said Matthew Tuttle, chief executive of Tuttle Capital Management.

Asia
The stock markets in East Asia only partially followed Wall Street's gains on Tuesday. In Tokyo, the Nikkei index rose by 1.1 per cent to 33,733 points after the holiday break at the start of the week. The index had already been quite a bit higher earlier in the week. The yen, which rose compared to the same time the previous day, had a slightly dampening effect. The latest price data shows that inflation in Japan remains unchanged at 2.1 per cent, just above the Japanese central bank's target. The Chinese stock markets are more subdued, with the trend remaining stable.

Bonds
U.S. bonds also rallied, driving the yield on the 10-year U.S. Treasury note down to 4.001% from 4.041% Friday. Bond yields fall when prices rise.

Analysis
UBS raises Carl Zeiss to Buy (Hold) – 125 (89) EUR
Morgan Stanley raises Sonova to Overweight
Citi raises Nordex target to EUR 15.50 (15) – Buy

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