Visa declined 5.5% after reports said the U.S. Justice Department’s antitrust division could file a lawsuit as soon as Tuesday accusing the payments giant of illegally monopolising the U.S. debit card market. The investigation focuses on whether the Company issued false and/or misleading statements and/or failed to disclose information pertinent to investors. Visa is the subject of a DOJ antitrust lawsuit filed on September 24, 2024. Attorney General Merrick Garland said, "We allege that Visa has unlawfully amassed the power to extract fees that far exceed what it could charge in a competitive market. Merchants and banks pass along those costs to consumers, either by raising prices or reducing quality or service. As a result, Visa's unlawful conduct affects not just the price of one thing -- but the price of nearly everything."

Driven by stocks from the luxury goods sector, the Swiss stock market closed higher on Tuesday. Richemont (+4.1%) and Swatch (+1.9%) shares were at the top of the winners' list on the back of stimulus measures in China. Hopes of rising demand in China drove share prices upwards, sources said. The SMI improved by 0.7 per cent to 12,049 points. Of the 20 SMI stocks, there were 16 winners and 2 losers, with 2 stocks closing unchanged. A total of 19.04 (previously: 16.48) million shares were traded. The defensive index heavyweights were mixed. Novartis shares were the SMI losers, falling 0.5 per cent. Roche, on the other hand, gained 0.5 per cent and Nestlé shares rose by 1.4 per cent. Swisscom (+0.4%) came one step closer to the planned takeover of Vodafone Italia. The EU Commission waved the 8.8 billion dollar deal through without any conditions after the deadline expired, as the Swiss telecoms group announced. Approval is now still required from the Italian competition authority, which launched an in-depth investigation at the beginning of September. Both the Italian government and the Swiss competition authority have given their approval.

Europe
European stocks were gaining on Tuesday after China announced economic stimulus measures and Federal Reserve officials signaled further interest-rate cuts. The Stoxx Europe 600 index gained 0.7% to 519.7 points. In Paris, the CAC 40 and SBF 120 climbed 1.3% and 1.2% respectively, buoyed by luxury goods stocks. The DAX 40 in Frankfurt picked up 0.8% and the FTSE 100 edged up 0.3% in London. The sectors most exposed to the health of the Chinese economy were in demand following the announcement of new stimulus measures in the country. Luxury goods in particular stood out, with Kering (+3.2%), Hermès (+3.9%) and LVMH (+3.2%). L'Oréal gained 4.2%. Spirits group Rémy Cointreau pocketed 2.7% and steelmakers ArcelorMittal and Aperam increased by 4.8% and 4.7% respectively. Danone (+0.7%) announced on Monday evening its intention to buy the remaining shares in US yoghurt drink producer LifeWay Foods for 283.4 million dollars, or 25 dollars per share. Danone already owns around 23% of LifeWay. Legrand (-0.2%) unveiled its targets for 2030 at an investor day. The electrical infrastructure specialist said it was aiming for sales of between €12 billion and €15 billion in 2030, with an average adjusted operating margin of around 20%.

United States
U.S. stocks climbed to new records Tuesday after China’s central bank unveiled a raft of measures to support the country’s weakening economy. The steps taken by the People’s Bank of China rippled through global markets-boosting shares of European luxury goods makers, lifting commodity prices and fueling gains in U.S.-listed stocks of Chinese companies such as Alibaba. Gains in stocks were undercut by disappointing U.S economic data, as the Conference Board said that its index of consumer confidence fell to 98.7 in September from 105.6 in August. That marked a three-month low and the largest one-month drop in more than three years. The S&P 500 added 0.25%, closing at a record high for the second straight session and 41st time this year. The Dow Jones Industrial Average ticked up 0.2%, or 84 points- also hitting a record – while the Nasdaq Composite advanced 0.6%. Investors generally are optimistic that the U.S. economy can avoid a recession, despite a recent uptick in the unemployment rate. After the Federal Reserve cut short-term interest rates by a larger-than-normal 0.5 percentage point last week, traders are betting that there is a better than 50% chance that the central bank will cut rates by the same amount at its next meeting in November, according to CME Group. Among individual stocks, mining giant Freeport-McMoran rose nearly 8% Tuesday, benefiting from a 3.3% gain in copper prices. Lifeway Foods saw its share price jump by 23.6 per cent. Danone intends to acquire the US food retailer in full for 283.4 million US dollars. Spotify shares rose by 3.1 per cent. Competitor Tiktok is closing its music streaming service. As the company announced, the service will be discontinued on 28 November. The Chinese parent company Bytedance had launched the service to compete with Spotify and Apple Music.

Asia
Asian stocks were mixed on Wednesday. In Shanghai, the Composite Index climbs by 1.7 per cent. In Hong Kong, the Hang Seng Index advances by 2 per cent. Meanwhile, the Japanese stock market is being held back by the yen, having appreciated slightly compared to the same time the previous day. The Nikkei 225 index held up well at 37,991 points. The Kospi in Seoul gave up initial gains and dropped by 0.1 per cent. Among the individual stocks, Posco declined by 1.8 per cent after Japan's Nippon Steel (+0.9%) announced the sale of its entire stake in the Korean steel group.

Bonds
U.S. bond yields were retreating, mostly reversing earlier gains on Tuesday, after a reading on consumer confidence in the economy showed its biggest one-month drop since mid-2021. The 2-year Treasury note yield eased by 4 basis points to 3.538%. The 10-year Treasury note yield also fell by 1 basis point to 3.538%.

Analysis
JP Morgan downgrades Richemont Target to CHF 155 (165) Overweight - Traders
UBS raises Ams-Osram to Buy (Neutral)/Target CHF 1.60 (1.20) - Traders
UBS lowers Swatch to Sell (Neutral)/Target CHF 127 (178) - Traders

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