The UBS barometer: the industry begins the ascent

9 years ago - Published in Finance, Fundamental Analysis

New economic recovery signals for the Swiss industry: in the second quarter, the UBS barometer of small and medium-sized enterprises (SMEs) rose to -0.16 points, compared with -0.18 points in the first three months of the year . For large companies, which compared to the smaller ones have suffered less than the ex-strengthening, it has gone from 0.24 to 0.52 points.

"The industry seems to have started to get back on top," the UBS economists commented in a statement today. In the second quarter barometers they have reached the highest level since October 2014. Regarding SMEs contributed to this improvement especially the increase in orders and backlog slightly higher than the previous month. The forecasts relating to orders for the third quarter were however not very rosy, a fact that probably prevented a more marked elevation of the barometer.

For large enterprises, with more than 200 employees, the increase is due in particular to higher orders from the previous year, the order backlog and higher than the highest production level.
In the construction sector both SMEs and large companies have still found good their current economic situation, despite a further slowdown took over in recent months. Both types of firms have had to contend with falling orders and erosion of profits, but SMEs are slightly more affected. Considering that all predict a decline in prices in the third quarter of 2016, the pressure on margins is not likely to ease in the near future.

The estimate of the great architectural and engineering firms around the question was slightly better than the previous survey, even better than that of those SMEs. Both enterprise types judge the business trend in the second quarter of 2016 better than in building.

Large companies in the service sector still believe the good performance of their business in the second quarter of 2016, but much worse than the last quarter of 2015. In the case of SMEs, the evaluation over the past few quarters has worsened only marginally. After a long period of increased demand in the second quarter of 2016 both SMEs both large companies have had to cope with a decline, a trend that could increase the pressure on prices and consequently on margins.

In retailing the situation of large groups has improved slightly, but is still below the level before the abolition of the minimum euro / franc exchange. The assessment of the economic situation of SMEs has remained steady at low level in recent months. The entire branch continues to struggle with low margins and prices under pressure. This difficult economic situation is reflected in employment, judged too high.
In tourism, large companies found just enough the state of affairs, while SMEs see it negatively. In addition to the difficulties on the monetary front, it has probably also affected the little snowy winter. Revenues are still under pressure, regardless of company size, and for the current quarter, the companies do not expect a recovery in sales.