Minutes from the Fed meeting "were not encouraging if you are a bull who's hoping to hear that the door is still open for further possible stimulus"
- Simon Denham, managing director of Capital Spreads in London
Swiss stocks fell on Wednesday as Federal Reserve's last meeting minutes diluted hopes for extra monetary stimulus amid climbing Spanish borrowing costs. The Swiss benchmark index SMI shed 1.09% or 68.28 points to 6,190.38.
"The market is reacting negatively to the minutes as they see less of a chance for a third round of quantitative easing. In addition, the worries regarding the crisis in Europe are not over. The Spanish bond sale results weren't that great, which is not good for market confidence", said Lars Knudsen at LGT Capital Management AG in Pfaeffikon, Switzerland.
"It's back to reality now, the auction shows the LTRO effect has been exhausted and now demand for Spanish paper is becoming much more price sensitive", said Peter Chatwell, a London-based fixed-income strategist at Credit Agricole Investment Bank.
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