Ericsson has agreed to sell its subsidiary Iconectiv to a unit of Koch Industries in a $1 billion transaction. The Swedish telecommunications-equipment company said Friday that it reached a deal with Koch Equity Development to offload Iconectiv, which provides connectivity services for networks, devices and applications. Ericsson expects to record a cash benefit of 10.6 billion Swedish krona, or $1 billion, after the settlement of taxes, transaction expenses and other liabilities, and a one-off earnings benefit of about 8.8 billion Swedish krona, or $800 million, when the transaction closes. The deal is expected to close in the first half of next year. Ericsson formed Iconectiv in 2012 from the assets of Telcordia Technologies, which it acquired that same year. In 2017, Francisco Partners invested $200 million for a 16.7% stake in the subsidiary, which valued the business at $1.2 billion.

The Swiss market ended modestly higher on Friday after a choppy session. The mood remained positive almost right through the day's session thanks to data showing a sharp surge in the nation's industrial output, and on hopes the Federal Reserve will start cutting interest rates in September. Lindt & Spruengli, Swiss Re, Julius Baer, Logitech International, Novartis, UBS Group and Nestle gained 0.6 to 1%. Sika, Swiss Life Holding, Sonova, Givaudan, Swisscom and Geberit posted modest gains. Straumann Holding and Swatch Group lost 1.3% and 1.22%, respectively. VAT Group ended nearly 1% down. SGS ended 0.53% down. The benchmark SMI ended with a gain of 38.51 points or 0.32% at 12,188.73. The index, which climbed to 12,222.01 around mid morning, briefly slipped into negative territory around mid afternoon before recovering to close higher. Data from the Federal Statistical Office said Swiss industrial production surged 7.3% year-over-year in the second quarter, reversing a 2% fall in the first quarter. Further, this was the biggest increase since the first quarter of 2021, when production had risen the same 7.3%. The output produced in the manufacturing sector was 6.8% higher compared to last year versus a 3.2% decline in the previous quarter. Data showed that the declining trend in construction output ended in the second quarter and advanced 0.8% compared to last year after a 2.9% decline in the second quarter.

Europe
European stocks closed broadly higher on Friday with some of the major markets in the region settling at multi-week highs amid easing fears about the outlook for U.S. economic growth, and optimism about an interest rate cut by the Fed next month. The U.K. market underperformed and snapped a five-day winning streak. The British pound strengthened against other major currencies after official data showed that U.K. retail sales volume rebounded in July – dashing investor hopes of a Q4 Bank of England rate cut. The pan European Stoxx 600 ended 0.31% up. Germany's DAX and France's CAC 40 climbed 0.77% and 0.35%, respectively. The U.K.'s FTSE 100 ended down 0.43%, while Switzerland's SMI gained 0.32%. Among other markets in Europe, Greece, Iceland, Norway, Poland, Portugal, Spain and Sweden closed higher. Denmark, Russia and Turkiye ended weak, while Austria, Belgium, Finland and Netherlands closed flat. In the UK market, Entain climbed about 2.75%, and Burberry Group gained 2.26%. Auto Trader Group, Rentokil Initial, Melrose Industries, Kingfisher, Endeavour Mining, Natwest Group, Beazley, Lloyds Banking Group, Pershing Square Holdings, Prudential and Smith (DS) gained 0.7 to 1.6%. RightMove, Berkeley Group Holdings, Fresnillo, Ashtead Group, Vistry Group, Sage Group, Diageo, Persimmon, Segro, Whitbread, Haleon, Associated British Foods, Unite Group, Taylor Wimpey, Glencore, Barrat Developments and Severn Trent lost 1 to 2.6%. In the German market, Bayer soared more than 10%. The stock gained after a US appeals court ruled that federal law protects the company from a lawsuit claiming its Roundup weed killer causes cancer. E.ON, Munich RE, Covestro, Deutsche Bank, Allianz, Hannover Rueck, Zalando, BASF, Fresenius, Mercedes-Benz, Deutsche Boerse and Deutsche Post gained 1 to 2%. Merck, Puma, Adidas, Continental, Infineon and Brenntag ended weak.

United States
U.S. stocks edged higher Friday, capping off their best week of the year in a head-spinning turnaround that defied recent concerns about rising recession risks. Buoyed by a surprising streak of encouraging economic reports, the S&P 500 gained 3.9% this week. The Dow Jones Industrial Average climbed 2.9%, and the Nasdaq Composite advanced 5.3%. It was the biggest weekly gain for each major index since last November. Friday’s trading session was quiet, but stocks were able to maintain their momentum from the previous few days. Stocks began rallying in earnest Tuesday in response to data that showed that wholesale-level prices rose less than anticipated last month. They added to those gains Wednesday after consumer-price index data also showed inflation cooling and surged again Thursday following better-than-expected reports on retail sales and jobless claims. The S&P 500, the Dow and the Nasdaq Composite each gained 0.2% Friday. Among individual stocks, H&R Block was a standout, rising 12% after the tax-preparation company notched strong earnings and forecast fiscal-year results above expectations. Large technology stocks were mixed, with Alphabet rising 1% but Meta Platforms falling 1.8%.

Asia
A favourable trend on the Chinese stock exchanges in Shanghai and Hong Kong was offset by profit-taking in Japan and South Korea on Monday. The Tokyo Nikkei 225 index fell by 0.8 per cent to 37,741 points following an almost 9 per cent rise in the previous week.

Bonds
The yield on the U.S. 2-year Treasury note settled at 4.064% Friday, according to Tradeweb, up from 4.054% a week earlier. The yield on the 10-year note edged down by 0.051 percentage point to 3.891%.

Analysis
UBS lowers Straumann to Sell (Neutral) – Target CHF 113 (120)
Bank of America raises Adyen target to EUR 1,760 (1,750) – Buy
JP Morgan raises LEG Immobilien target to EUR 100 (92

Produced by MBI Martin Brückner Infosource GmbH & Co. KG on behalf of Swissquote. All news is acquired with journalistic accuracy. No liability is assumed for delays or errors.