Swiss Market Closes Higher as ABB Leads Strong Rally on Solid Q4 Results

The Swiss equity market delivered a solid performance on Thursday, with the benchmark SMI index advancing 124.12 points or 0.95% to close at 13,147.93. After dipping to 12,941.92 in early trading, the index climbed to a high of 13,201.33 during the session, eventually settling on a firm note and outperforming most of its European peers. The rally was primarily driven by strong corporate earnings and robust guidance from major constituents.

ABB Delivers Strong Earnings Beat and Guidance

ABB emerged as the session’s standout performer, surging 8.5% on the back of impressive fourth-quarter results and forward-looking guidance. The industrial technology company reported net income climbed 29% to $1.27 billion from $987 million a year earlier, with basic earnings per share growing 30% to $0.70 from $0.54.

Order growth proved particularly robust, rising 36% on a reported basis and 32% on a comparable basis to reach $10.32 billion. Looking ahead, ABB demonstrated confidence in its growth trajectory, guiding for comparable revenue growth in the 7% to 10% range for the first quarter of 2026, with operational EBITA margins expected to expand year-on-year, excluding announced real estate gains.

The company also announced a new share buyback program of up to $2.0 billion, with execution running through January 27, 2027. This capital allocation move signaled management’s conviction in the company’s valuation and near-term prospects.

Broader Market Divergence Amid Mixed Signals

Beyond ABB, the market showed a more nuanced picture. Roche Holding advanced more than 2.5%, while Lindt & Sprüngli and Nestlé gained approximately 2.1% and 1.3% respectively. Kuehne + Nagel, Swiss Re, Zurich Insurance, Helvetia Baloise, and Swiss Life Holding posted moderate gains.

However, weakness was evident in other segments. Givaudan tumbled 6.8%, marking the session’s most significant decliner. Lonza Group drifted down 2.3%, while Straumann Holding lost about 2%. Additional decliners included VAT Group, Logitech International, Partners Group, Geberit, Richemont, and Galderma Group, which lost between 1% and 1.7%. UBS Group ended marginally lower with a 0.52% decline.

Swiss Economy Faces Trade Headwinds While Watch Sector Shows Resilience

On the economic front, Switzerland’s trade landscape painted a more cautious picture. Federal Customs Administration data revealed that the country’s trade surplus compressed in the fourth quarter, declining to CHF 11.9 billion from CHF 13.2 billion in the third quarter. This contraction reflected broader export weakness, with exports falling 4% in real terms following a 4.6% decline in the September quarter. Imports, conversely, rose 1.2%, compared with 1.6% growth in the prior period.

In nominal terms, exports edged up 0.8%, while imports increased 3.3% relative to the third quarter, signaling shifting dynamics in Switzerland’s trade flows.

One bright spot emerged from the Federation of the Swiss Watch Industry, which reported watch exports grew 3.3% year-on-year in December. However, this December strength was insufficient to offset earlier weakness, with total watch exports registering a 1.7% decline for the full year 2025 compared with 2024.