Swiss Stocks Decline; Credit Suisse, UBS Shares Lead SMI Lower in Zurich

Swiss stocks declined for the first time in three days, led by banks, after slower-than forecast economic growth in Japan increased concern that the global recovery may be faltering.

Credit Suisse Group AG and UBS AG led the retreat on the Swiss Market Index as all but three companies fell. Santhera Pharmaceutical Holding AG rallied 8 percent, continuing its surge from last week after receiving patent protection for its Catena medicine.

The Swiss Market Index of the biggest and most actively traded companies retreated 0.6 percent to 6,260.03 as of 2:15 p.m. in Zurich. The broader Swiss Performance Index lost 0.5 percent to 5,528.20.

“We’ve had poor economic data out of Japan announced earlier today -- much worse than market expectations,” said Bob Parker, a London-based senior adviser to Credit Suisse Asset Management, which oversees about $414 billion. “On the equities side we’re currently being defensive.”

Shares of Holcim Ltd., Roche Holding AG and Adecco SA have paced a 10 percent slump in the SMI from this year’s highest level on April 15. The gauge dropped last week after the Federal Reserve said that the U.S. economy’s recovery is likely to be “more modest” than forecast.

A report showed Japan’s economy expanded at the slowest pace in three quarters, slipping behind China to become the world’s third-largest economy. Gross domestic product rose an annualized 0.4 percent in the second quarter, the Cabinet Office said. The median estimate of 19 economists surveyed by Bloomberg News was for growth of 2.3 percent.

Credit Suisse lost 1.5 percent to 46.19 Swiss francs. UBS declined 0.9 percent to 17.25 francs.

Santhera climbed 8 percent to 9.50 francs. The developer of drugs to combat nerve-related diseases rallied 10 percent last week after the European Patent Office granted patent protection for Catena.