Novartis raised its full-year guidance for the third time this year after higher third-quarter profit and sales topped analysts’ expectations, boosted by revenue from its key drugs. The Swiss pharmaceutical giant said Tuesday that it now expects its core operating profit - one of its preferred metrics, which strips out exceptional items - to grow by a high-teens percentage in 2024 compared with its previous target of growth in the mid- to high-teens range. Novartis now forecasts full-year sales growth to be in the low double digits, having previously guided for high-single to low-double-digit growth. Core operating profit for the third quarter grew to $5.145 billion from $4.41 billion the year prior. The numbers for last year’s third quarter reflect the group’s current operations, taking into account the spinoff of generics business Sandoz last October. Net sales for the quarter grew to $12.82 billion from $11.78 billion. Analysts polled by Visible Alpha had forecast $4.87 billion in core operating profit and $12.62 billion in sales.

The Swiss market shrugged off a mid-session setback and closed on a firm note on Monday with select counters seeing some brisk buying in afternoon trades. Investors largely stayed cautious, looking ahead to Swiss inflation and retail sales data as well as reports showing readings of KOF Leading Indicators and the Economic Sentiment Index, all due during the course of this week. The benchmark SMI closed up 53.97 points or 0.44% at 12,237.97, recovering well from a low of 12,155.96. Sonova rallied nearly 7.5% after the company said it is set to resume supplies to Costco. The product to be sold at Costco, a prescription hearing aid by the name of Sennheiser Sonite R which was specifically designed for the retailer, will initially be available in 107 locations in the United States, with a gradual expansion expected in the future, according to a Reuters report. SIG Group and Holcim climbed 3.58% and 3.44%, respectively. Logitech International gained 2.79%. Sika, Sandoz Group, SGS, Noartis and Julius Baer ended higher by 1.1 to 1.7%. Swiss Re, Zurich Insurance, Geberit, ABB, Swatch Group, UBS Group, Partners Group, Swiss Life Holding and Straumann Holding gained 0.5 to 1%. Roche Holding and Lonza Group ended lower by 1.21% and 1.15%, respectively.

Europe
European stocks closed higher on Monday with investors closely following the developments on the geopolitical front, and looking ahead to a slew of economic data from the region for clues on the European Central Bank's interest rate trajectory. Eurozone preliminary flash GDP, consumer confidence and economic sentiment data are due on Wednesday. Confidence among U.K. businesses fell to its lowest in four months in October as they adopted a cautious stance ahead of the first budget presentation by the new chancellor Rachel Reeves later this week, results of a survey showed today. Shares of oil companies were under pressure as crude prices plunged to four-week lows amid easing fears of a Middle East war. Investors heaved a sigh of relief as Israeli strikes on Iran over the weekend avoided the OPEC member's oil facilities. The pan European Stoxx 600 gained 0.46%. The U.K.'s FTSE 100 climbed 0.53%, Germany's DAX closed up 0.34% and France's CAC 40 ended stronger by 0.89%, while Switzerland's SMI ended 0.44% up. Among other markets in Europe, Austria, Belgium, Finland, Iceland, Ireland, Spain, Sweden and Turkiye closed higher. Poland edged up marginally. Denmark, Netherlands, Norway, Portugal and Russia ended weak. In the UK market, Melrose Industries soared nearly 10%. Easyjet and Pearson climbed 2.8% and 2.69%, respectively. Halma, Natwest Group, Convatec Group and Informa advanced 2 to 2.75%.

United States
After showing a strong move to the upside early in the session, stocks gave back ground over the course of the trading day on Monday but managed to end the day mostly higher. The major averages all finished the day in positive territory after turning in mixed performances over the two previous sessions. The Dow advanced 273.17 points or 0.7 percent to 42,387.57, the Nasdaq climbed 48.58 points or 0.3 percent to 18,567.19 and the S&P 500 rose 15.40 points or 0.3 percent to 5,821.52. The strength on Wall Street comes amid a steep drop by the price of oil. Oil prices plunged after Israel's retaliatory attack against Iran over the weekend did not damage the Islamic republic's energy facilities. Meanwhile, traders were also looking ahead to the release of key U.S. economic data later in the week. The monthly jobs report as well as a report on personal income and spending that includes the Federal Reserve's preferred inflation readings are likely to be in the spotlight. Earnings news is also likely to be in focus in the coming days, with Alphabet (GOOGL), Amazon (AMZN), Exxon Mobil (XOM), Intel (INTC), McDonald's (MCD), Meta Platforms (META), Microsoft (MSFT) and Pfizer (PFE) among the companies due to report their quarterly results. Airline stocks saw substantial strength on the day, with the NYSE Arca Airline Index soaring by 3.0 percent to its best closing level in over a year. Delta Air Lines (DAL) posted a standout gain after filing a lawsuit against CrowdStrike (CRWD) over the July outage that led to thousands of flight cancellations. Significant was also visible among steel stocks, as reflected by the 3.0 percent surge by the NYSE Arca Steel Index.

Asia
With the exception of China, slight losses predominated on the Asian and Australian stock exchanges on Tuesday. In Tokyo, the rally is continuing after the significant gains of the previous day, albeit with less momentum. In view of the political uncertainty following the elections in Japan and a slightly recovering yen, traders are somewhat surprised at the strength of the market. After initial losses, the Nikkei-225 is 0.6 per cent higher at 38,851 points.

Bonds
In the bond market, treasuries extended the pullback seen in the previous session. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 4.6 basis points to a three-month closing high of 4.278 percent.

Analysis
UBS raises Vinci target to EUR 132 (131) – Buy
UBS raises Natwest target to 460 (420) p – Buy
HSBC raises Eni target to EUR 16.30 (15.90) – Buy

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