UBS is set to pay at least hundreds of millions of dollars to settle violations by Credit Suisse of an earlier agreement with the U.S. Justice Department over American clients who evaded tax, people familiar with the matter said. A settlement could come as soon as this week, one of the people said. Prosecutors have weighed how best to punish Credit Suisse since it came under new ownership via a rescue by UBS in 2023. It could be one of the last big actions for the Justice Department under the departing Biden administration, which promised to crack down on repeat corporate offenders. Credit Suisse pleaded guilty in 2014 to conspiring to help thousands of Americans cheat on their taxes. It paid $2.6 billion to U.S. authorities and entered a plea agreement requiring it to root out and shut any remaining undeclared American-held accounts. The payout was partly based on a $1.33 billion criminal fine, which was half of the maximum indicated by U.S. guidelines. The Swiss bank promised to provide the Justice Department with information on the accounts it shut and where the money went next. Failing to do so left it open to further punishment.

The Swiss market, which stayed positive save for a few minutes at the start of the session on Thursday, closed modestly higher, in line with markets across Europe. The benchmark SMI closed up 50.90 points or 0.43% at 11,927.11. The index, which edged down slightly to 11,868.98 in early trades, touched a high of 11,968.89 in the session. UBS Group gained nearly 3%. Sandoz Group and Partners Group both closed higher by about 2.4%. Roche Holding climbed 1.84% and Givaudan ended higher by 1.52%. Straumann Holding, SGS, Novartis, Swisscom and Sonova also closed on firm note. Adecco closed lower by 6.23%. VAT Group ended nearly 6% down. Swatch Group lost about 3% following a rating downgrade. Lindt & Spruengli declined 2.7%, while Kuehne + Nagel, Zurich Insurance Group, Swiss Re closed down 1.1 to 1.4%. Richemont, SIG Group, Geberit, Swiss Life Holding, Sika and Nestle also ended weak. Data released by the Swiss National Bank said foreign exchange reserves in Switzerland increased to CHF 730.96 billion in December from CHF 724.69 billion in November of 2024.

Europe
European stocks closed broadly higher on Thursday with those from the mining sector turning in a fine performance thanks to higher metal prices. A sell-off in retail stocks, tariff threats by U.S. President-elect Donald Trump, and persisting concerns about inflation limited markets' upside. Among the major markets in the region, the U.K. closed on a strong note with its benchmark FTSE 100 rising 0.83%. France's CAC 40 climbed 0.51%. Germany's DAX edged down 0.06%, weighed down by recent weak data on factory orders and retail sales. The pan European Stoxx 600 gained 0.42%. Markets in Austria, Denmark, Greece, Iceland, Netherlands, Norway, Poland, Portugal, Spain, Sweden and Turkiye closed higher. Russia ended weak, while Belgium, Finland and Ireland closed flat. In the UK market, mining stocks Anglo American Plc, Antofagasta and Fresnillo climbed by about 3.25%. Rio Tinto advanced 1.8% and Endeavour Mining gained about 1.5%. Compass Group, Smith (DS), Hikma Pharmaceuticals, AstraZeneca, JD Sports Fashion, RightMove, IAG, Barratt Redrow, Games Workshop, Smith & Nephew, St. James's Place, Aviva, Weir Group and Informa gained 1.5 to 2.5%. HSBC Holdings, ICG, IMI, Bunzl, Shell and Spirax Group also closed notably higher. Marks & Spencer tumbled 8.4% despite the company reporting a 5.6% jump in sales in the third quarter. Despite a 3.5% rise in sales, B&M European Value Retail plunged 8.6% as the company narrowed its profit guidance. Tesco came off lows and ended just slightly weak. The retailer said its Christmas sales grew 3.7%. In the German market, Siemens Energy rallied about 3%. Commerzbank, HeidelbergCement, Deutsche Bank, Sartorius and Fresenius gained 1.7 to 2.6%. RWE, Zalando, Munich RE, Continental, Deutsche Post, BMW, E.ON and Infineon lost 1.5 to 2.5%. In the French market, Teleperformance climbed nearly 4%. Eurofins Scientific, Safran, LVMH, Vivendi, Schneider Electric, Kering, Pernod Ricard, Danone, Legrand, Accor and Edenred gained 1 to 2.2%. Renault, Michelin, AXA, Thales, Airbus Group, Societe Generale, Capgemini and STMicroElectronics ended with sharp to moderate losses.

United States
U.S. stock markets remained closed yesterday for the entire day to mark former President Jimmy Carter’s memorial.

Asia
Negative signs dominate the stock markets in East Asia and Australia at the end of the week. The Japanese stock market is also being weighed down by fears that the Bank of Japan could soon adopt a tighter stance. In line with this, spending by private Japanese households in November fell less sharply than expected on a monthly basis and actually increased compared to the previous year. The Nikkei 225 index lost 0.9 per cent to 39,240 points.

Bonds
Yields on the US bond market fell again slightly on Thursday. The ten-year yield fell by 2.5 basis points to 4.68 per cent.

Analysis
UBS lowers Anheuser-Busch InBev target to EUR 66 (70) – Buy
Barclays resumes Delivery Hero with Overweight and target EUR 49
Barclays raises Deutsche Bank target to EUR 22.60 (22) – Overweight

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