Switzerland's business community was in a state of shock this week as the events from New York and Washington unfolded. The attack on the World Trade Center hit at the very heart of the American financial community and many people in Switzerland will have lost friends and business colleagues.
As the severity of the attack sunk in, the impact on European markets was swift and severe with the Swiss Market Index (SMI) falling more than seven per cent in the wake of Tuesday's events.
With the markets already trading at three-year lows in the face of the economic slowdown, there was panic selling. Airline companies, banks and insurance companies were some of the worst affected.
But as the week wore on, major European markets, including the SMI, rallied and recovered some lost ground. But with the New York stock Exchange remaining closed until Monday, trading remained thin as Europe lacked its usual American lead.
Analysts are now looking to what might happen when New York reopens for business on Monday.
"The US market may open down between five and eight per cent," said Eleanor Charrez, a trader at Bank Leu. "But at least the closure has given people time to think."
There were also fears that the attack on the United States could tip the faltering world economy into a full-blown recession.
But many analysts still feel a global recovery is more likely.
"There's a big difference between what happened in 1990 in the Gulf War when oil supplies were hit and now," said Cantrade private bank economist, Marcus Allenspach, "This time the Saudis have promised to boost supplies.
"In 1990 it was clear that a large scale military conflict would take place," he added, "This time it's less likely to develop into a full scale military assault."
Insurance companies are facing a massive bill after Tuesday's attacks, with the cost put at between $10 to $15 billion (SFr16.6 to SFr24.9 billion). Swiss Re said this week that it expected to pay out around SFr1.2 billion.
The world's airlines are also counting the costs.
The Geneva-based International Air Transport Association (IATA) said airline companies face revenue losses and extra costs of around $10 billion as a result of the attacks.
Around 4,000 of the world's 12,000 commercial airliners were grounded after the US suspended flights. The IATA says the US market is worth around $1 billion a day.
There was little other news on the domestic front this week.
Zurich Financial Services confirmed on Thursday that it was in advanced talks to sell its Scudder asset management business to Deutsche Bank in a deal that could involve an asset swap.
As part of the transaction, it's believed the group will acquire Deutsche Herold and other insurance subsidiaries of Germany's largest bank. Zurich is also expected to receive an amount of cash that would substantially ease its debt burden.
by Michael Hollingdale