Ouch! This is why I taint the pharma news to the stocks. The Swiss pulled the cap on the Franc and “Kaboom” The Franc rockets to the moon and Swiss shares get a beating.
Roche, Novartis, Actelion and Lonza all took a hair cut today.
Lonza took it for an 18% bashing today as 90% of their operations are exported. If dollar and Euro holders have to pay more for Lonza products, this is a crushing blow for Lonza forecasts — AND R&D Spending.
Currency fluctuation is a very confusing thing. If the franc goes up, why do Swiss stocks get nailed. Well, the higher the franc, the less of it you need to buy shares; so the stocks get repriced to represent the newly valued Franc.
I always keep my eye on the ball to forecast where the R&D spending will be. This doesn’t mean Swiss Phara will slow it down, but it’s certainly something to watch.
SMZ
