Swiss Stocks Tumble as Trump Tariffs Loom

The U.S. imposed tariffs up to 39% on Swiss goods, a move considered a “catastrophic blow” by Swissmem. The tariffs, second highest after Syria, sent Swiss “concept stocks” tumbling, with Roche, UBS, and watch group shares declining. The U.S. is a key export market for Switzerland, and the country had anticipated lower tariffs similar to those with the EU. Experts predict a negative impact on Swiss GDP, the franc, and export-reliant companies. The tariffs are scheduled to take effect on August 7th, but adjustments are still possible.

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On what should have been a celebratory Swiss National Day (August 1st), market watchers were jolted back to their desks by an unexpected announcement: the White House is slapping tariffs as high as 39% on Swiss goods.

President Trump signed an executive order on July 31st, outlining “reciprocal tariffs” against several countries and regions, ranging from 10% to a hefty 41%, according to reports.

Switzerland’s 39% tariff rate places it among the highest in this latest round, second only to Syria’s 41% and just ahead of Myanmar and Laos at 40%. For the alpine nation synonymous with precision and stability, this feels less like a gentle yodel and more like an economic avalanche.

Unsurprisingly, “Swiss concept stocks” took a hit. As of the time of this report, Roche ADRs trading in the US were down 1.6%, UBS American shares dipped 2.2%, and Swiss watch group shares listed in London plunged 7.5%.

瑞士突遭特朗普关税重击:多只出口类股应声下挫

The market had largely anticipated a framework agreement similar to those established with the EU, UK, and Japan, keeping tariffs in the 10-15% range. Switzerland landing in the top tier of tariff targets came as a rude awakening.

The U.S. is a crucial export market for Switzerland, absorbing approximately one-sixth of its total exports. Switzerland breathed a sigh of relief in April when a previously planned 31% tariff was temporarily reduced to 10%.

The “reciprocal tariffs” are slated to take effect seven days after the executive order’s publication date (excluding that day), putting the implementation on August 7th. Given President Trump’s penchant for last-minute reversals, the situation remains fluid.

However, initial market reactions Friday were overwhelmingly negative, reflecting deep uncertainty.

Swissmem, the association representing the Swiss mechanical, electrical, and metal industries, called the 39% tariff a “catastrophic blow” to Swiss technology, exports, and the entire nation, emphasizing that “for every two Swiss francs earned, one comes from foreign trade.”

“I am shocked,” stated Swissmem Director Stefan Brupbacher. “This tariff has no rational basis and is a completely arbitrary decision. This decision puts thousands of jobs at risk.”

Beat Wittmann, chairman and partner at Swiss consulting firm Porta Advisors, described the tariffs as “devastating” for the Swiss economy and its businesses, predicting a weakening of the Swiss economy, the franc, and the Swiss stock market, especially companies heavily reliant on exports.

Switzerland’s primary exports include chemical products, pharmaceuticals, watches and jewelry, chocolate, gemstones, and electronics.

Adrian Prettejohn, European economist at Capital Economics, wrote in a research note that if the 39% tariff remains in place, it could shave approximately 0.6% off Swiss GDP. Additional tariffs on pharmaceuticals could exacerbate the impact, although Prettejohn anticipates the rate will ultimately be lowered.

Investment bank Jefferies noted in a client report Friday that Richemont and Swatch Group are among the companies likely to be most affected. However, they also pointed out that with time remaining before the tariffs take effect, “there is still plenty of room for adjustments and modifications.”

The Swiss franc has appreciated by roughly 11% this year as investors seek safe-haven assets, posing challenges for the Swiss economy. In May, Switzerland recorded negative year-over-year inflation for the first time in years, prompting the Swiss National Bank to cut interest rates to zero in June.

瑞士突遭特朗普关税重击:多只出口类股应声下挫

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