Unicredit has cleared up a major hurdle in its takeover of Commerzbank. The Italian bank announced that it has received approval from the European Central Bank (ECB) to exceed the 30 percent ownership threshold and further increase its stake. Unicredit recently secured just under half of the shares in German bank Commerzbank. According to Unicredit, the remaining regulatory processes and conditions necessary to finalize the offer for Commerzbank are expected to be completed by the end of the year. At that point, it will hold just under 50 percent of the voting rights and be in a position to take control.

Swiss stocks moved higher on Thursday, extending gains to a fifth straight session, thanks to strong buying at several counters. In addition to digesting Swiss producer and import prices data, investors looked ahead to corporate earnings updates. The benchmark SMI settled with a gain of 219.58 points or 1.55% at 14,349.51, the day's high. Lindt & Spruengli, up 6.3%, was the top gainer in the SMI index. Alcon, Lonza Group and Swisscom gained 3.1%-3.3%. Givaudan, Zurich Insurance, Nestle and Novartis climbed 2.6%-3.25%. Roche, Amrize, Sandoz Group, Swiss Re, Geberit, Sika, Straumann Holding, Sonova, Kuehne + Nagel, Helvetia Baloise Holding, Logitech International and Swiss Life Insurance moved up 1.2%-3%. VAT Group closed lower by 1.8% despite the company reporting higher sales in the third-quarter. ABB drifted down 3.4%. Julius Baer and Holcim ended with modest losses. Data released by the Federal Statistical Office showed Switzerland's producer and import prices increased for the second straight month in September, with the index rising 0.3% in the month, slower than the 0.7% climb in August. That was slower than the 0.6% rise expected by economists. The producer price index decreased 1.2% from last month, while import prices rose 2.1%.

Europe
The major European markets closed higher on Thursday, supported by gains in retail, luxury, pharmaceuticals and industrials sectors even as tech stocks were under some pressure amid uncertainty about returns on AI-related investments. Softening global bond yields and strong UK GDP data aided sentiment. The pan European Stoxx 600 climbed 0.38%. The UK's FTSE 100 moved up 1.08%, Germany's DAX gained 0.33% and France's CAC 40 closed 0.78% up. Among other markets in Europe, Belgium, Czech Republic and Denmark ended higher. Austria, Finland, Greece, Iceland, Netherlands, Norway, Portugal, Russia, Spain, Sweden and Türkiye closed weak, while Ireland and Poland ended flat. In the UK market, Experian climbed nearly 6%. The Sage Group gained 5.7%, while Compass Group, JD Sports Fashion, BT Group, Intercontinental Hotels Group, Autotrader Group and Relx moved up 4%-4.5%. Smith & Nephew, British Land, Haleon, LSEG, Pearson, AstraZeneca, Endeavour Mining, Fresnillo, WPP, Next, Severn Trent and St. James's Place rallied 3%-3.7%. GSK, Admiral Group, Burberry Group, United Utilities, Coca-Cola Europacific Partners, IG Group Holdings, Land Securities, Airtel Africa, Kingfisher, Reckitt Benckiser, Bunzl, Vodafone Group and Associated British Foods also moved up sharply. Computacenter dropped 5.6%. Polar Capital Technology Trust drifted down 4.7%. Antofagasta and Weir both ended down by 4%. Ithaca Energy, Rio Tinto, Halma, Segro, IMI, Smiths Group, Diploma, Pershing Square Holdings and Scottish Mortgage also closed notably lower. In the German market, Scout24 soared 7.5%. Rheinmetall and Zalando gained 3.9% and 3.8%, respectively. Fresenius Medical Care, Symrise, SAP, Munich RE, Adidas, Siemens Healthineers, Deutsche Post, E.ON, Vonovia, Hannover RE and Deutsche Telekom also posted strong gains. In the French market, Publicis Groupe, Capgemini, Hermes International, L'Oreal, Orange, Dassault Systemes and Carrefour gained 3%-3.7%.

United States
U.S. stocks rose despite tech sector volatility and a hot wholesale inflation reading as Treasury yields gave back some recent gains. The Dow Jones Industrial Average rose 556.80 points, or 1.08%, to 52178.28, and the S&P 500 gained 25.17 points, or 0.33%, to 7744.11, and the tech-heavy Nasdaq Composite edged 20.16 points, or 0.08%, 26713.03. The producer-price index rose by 1.3% in September on a month-to-month basis, far above both the 0.4% increase in August and economists' expectations of 0.6%. It was the largest increase in the gauge in more than four years. Shares of CoreWeave, the provider of cloud-computing services whose credit quality has become a concern, rose 5.9% to $69.69 even as odds the of a default rose in derivatives markets. One brokerage those credit concerns may be overdone. Dell Technologies, a supplier of servers and other products to cloud companies like CoreWeave, retreated 6.8% to $473.39 and is down by roughly 19% in the last four sessions. In the financial sector earnings continued to come in strong. Bank of New York Mellon shares rose 3.6% to $142.53 after the custodial bank and asset manager logged brisk third-quarter earnings growth, citing higher fees and interest income, even as executives flagged an uneven operating environment. Discount brokerage Charles Schwab logged earnings growth, as the AI investment craze drove higher balances in customer accounts. Shares slipped 2.7% to $94.16, reflecting market wobbles.

Asia
Following the previous day’s slump, East Asian stock markets saw today a strong recovery. The recovery was particularly marked in Seoul, where the Kospi rose by 3.6 per cent.

Bonds
The yield on the 10-year U.S. Treasury bond dropped 0.102 percentage point to 5.086%, the largest one-day retreat in more than a year, according to Dow Jones Market Data. The yield on the 30-year bond slipped 0.097 percentage point to 5.427%, also the biggest drop in more than a year. The two-year Treasury's yield declined 0.053 percentage point to 4.747%, which was the biggest decline in two weeks.

Analysis
JPMorgan raises its Swiss Re target price to CHF 130 (125) – Underweight
UBS lowers its Huber + Suhner target price to CHF 300 (320) – Buy
UBS lowers its Rio Tinto target price to 7,300 (7,400) GBp – Neutral

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