Swiss Stock Market
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Key Takeaways
- The SMI closed lower in early April 2026, with UBS shares in particular coming under pressure following the publication of annual results
- The federal government's expert group for economic forecasts projects economic growth of only 1.0% for 2026 (previously 1.1%)
- Kühne+Nagel and Asmallworld showed strength, while Amrize and Montana Aerospace trended more weakly
- According to Vontobel, Swiss watch manufacturers have scope to cushion the burden of tariffs
- The yield curve flattened noticeably as of 20 March 2026, with yields on two-year government bonds rising
The Swiss leading index SMI closed lower on 2 April 2026 as UBS shares in particular revealed operational weaknesses following the announcement of annual results. The bumpy start to the stock market year 2026 continues and confirms cautious economic forecasts for the Swiss economy.
Weak start to stock market year despite strong end of 2025
After a strong rally at the end of 2025, Swiss securities came under pressure in the first quarter of 2026. According to Basel Cantonal Bank, the start to the stock market year 2026 was extremely bumpy – a pattern already observed in the previous year. Back then, the topic of import tariffs caused turmoil in the markets, but lost much of its impact after several months.
The current weakness is concentrated mainly on individual securities: UBS shares showed operational weaknesses following the publication of annual results. On the winners' side are logistics company Kühne+Nagel and social network platform Asmallworld, which both remained in demand. Amrize and aerospace supplier Montana Aerospace presented themselves more weakly.
Economic forecasts for 2026 revised downward
The federal government's expert group for economic forecasts expects below-average economic growth of 1.0% for 2026 (December 2025 forecast: 1.1%). For 2027, experts expect an acceleration to 1.7%. The downward revision reflects dampened prospects for the Swiss economy and weighs on sentiment in the stock markets.
The ongoing low interest rate environment in Switzerland brings both challenges and opportunities, according to Zurich Cantonal Bank. The rapid adjustment of key interest rate expectations has in particular driven the yields of two-year government bonds higher. As of 20 March 2026, the yield curve has flattened noticeably.
Tariffs burden Swiss watch industry only moderately
Swiss watch manufacturers face pressure from import tariffs but have some scope to cushion costs. Jean-Philippe Bertschy, Head of Swiss Equities Research at Vontobel, explains: "Swiss watch manufacturers will not pass all costs on to the end consumer. They have some scope to cushion the tariffs."
Bertschy also sees positive signals from the US: "The strong US stock market has partially offset the negative effects of tariffs." Looking ahead to 2026, the market for luxury watches in China could recover, which would provide additional tailwinds for the Swiss watch industry.
Selective opportunities despite difficult environment
Despite the bumpy start and dampened economic forecasts, investors have selective opportunities in the Swiss stock market. In particular, the logistics sector with Kühne+Nagel shows strength, while the aerospace sector remains under pressure. Montana Aerospace was among the weaker stocks, while US aerospace and defense company RTX generated significantly more revenue in the fourth quarter of 2025 than analysts expected – an indication of different dynamics within the industry.
The coming months will show whether the Swiss stock market can recover from the weak annual performance or whether dampened economic growth will further burden prices.