Vontobel cuts Swiss Re to 'hold' on softer reinsurance cycle, fair valuation

** Vontobel downgrades Swiss Re SRENH.S to "hold" from "buy", pointing to recent strong share performance, softening cycle for property and casualty reinsurance

** "Property & Casualty Reinsurance pricing environment has been challenging since the beginning of the year, and we do not see a reversal in the current pricing cycle anytime soon," the broker says

** It expects lower margins and higher combined ratios as a result of the pricing environment, but notes the Swiss company remains "highly selective" in underwriting

** Stock price now reflects "prudent approach" after having risen nearly 30% since early June, Vontobel adds

** Broker lowers its target price to 145 Swiss francs ($174), in line with current market valuation as of Monday's close

($1 = 0.8330 Swiss francs)