The best week on Wall Street in six months appears to have pulled the market out of its recent correction, with investors more confident that the US economy is on track. \nSome analysts say however that the market may still be too pricy after a year of strong gains, and see little room for further gains or even a downward drift for the rest of the year. \nIn the week to Friday, the Dow Jones Industrial Average climbed 2.52 percent to 10,470.59 and the tech-heavy NASDAQ powered ahead with a gain of 4.96 percent to 2,057.17 \nThe broad-market Standard and Poor's 500 index rallied 3.04 percent for the week to finish at 1,141.81. \nIt was the best week on Wall Street since the week to October 3, and prompted many analysts to declare an end to the correction of the past few weeks. \nThe key piece of news over the past week was the surprisingly strong US employment report showing a stunning 308,000 jobs created in March. \n"The final piece of economic recovery is in the process of falling in place. Finally, jobs are responding to economic expansion," said Sung Won Sohn, chief economist at Wells Fargo Bank. \nOthers noted that the economy may not be as sizzling as the report suggested, and cautioned against betting on higher interest rates soon. \n"The strong showing in March payrolls is further proof that hiring conditions are improving. But the gain is overstated, and other readings are mixed," said Citigroup's Robert DiClemente. \nDiClemente noted that the unemployment rate, based on a separate survey, edged higher, and that the increasing labor pool means there is still slack in the economy. \nThe bond market was hammered nonetheless by expectations of higher rates. The yield on the 10-year US Treasury bond jumped to 4.140 percent from 3.843 percent a week earlier and that on the 30-year bond to 4.972 percent from 4.770 percent. Bond yields and prices move in opposite directions. \nAs for Wall Street, Art Hogan at Jefferies and Co said the market appears to be shifting into a new cycle and that "the downsize correction seems over now." \nBut he said the market will now turn its attention to corporate earnings news, and will need to see strong results to continue on an upward trend. \nBut Tobias Levkovich at Smith Barney offered a cautious view, saying overly enthusiastic investors have been pushing prices to levels that cannot be sustained. \n"We are hard-pressed to come up with a clear rationale for why investors are going to throw money at the equity market currently," he said. \n"Yet, we find many reasons for stepping back and remaining defensively positioned ... In this context, we believe equity investors should remain cautious with 10 to 12 percent further market downside risk by the summer," Levkovich added. \n"And this analysis does not even incorporate worries about oil prices, terrorism, or the uncertainty over the upcoming US presidential election." \nGoldman Sachs chief strategist Abby Joseph Cohen said she still sees a positive year for Wall Street as it extends its gains from the bear market that ended a year ago. She maintained her forecast that the S&P 500 would hit 1,250 by year-end. \n"Much has changed in the past 12 months. The global economy is expanding, corporate profits are rising and investors are approaching decisions not by avoiding risks but by balancing potential risks and rewards," she said. \n"Recent geopolitical worries, such as the bombings in Madrid and the contested election in Taiwan, are reflected in markets but do not paralyze investors."
SELF-SUFFICIENCY: Alibaba is one of a number of Chinese firms that has answered Beijing’s call to invest in the development of cutting-edge technologies Alibaba Group Holding Ltd (阿里巴巴) yesterday unveiled a new server chip that is based on advanced 5-nanometer technology, marking a milestone in China’s pursuit of semiconductor self-sufficiency. The Chinese tech giant’s newest chip is based on micro-architecture provided by the SoftBank Group Corp-owned Arm Ltd, it said. Alibaba, which is holding its annual cloud summit in Hangzhou, China, said that the chip is to be used in its own data centers in the “near future” and would not, for the time being, be sold commercially. “Customizing our own server chips is consistent with our ongoing efforts toward boosting our computing capabilities with better
‘SHORT-TERM ECONOMIC PAIN’: A military takeover would only temporarily weigh on wafer production on both sides of the Taiwan Strait, IC Insights said Taiwan has more chip manufacturing capacity than any other economy in the world, US-based market information advisory firm IC Insights said in a research paper last week, cautioning that the nation’s strength could prompt China to attempt to take over Taiwan. Taiwan commanded 21.4 percent of global installed IC capacity, ahead of South Korea’s 20.4 percent, Japan’s 15.8 percent and China’s 15.3 percent, North America’s 12.6 percent and Europe’s 5.7 percent, IC Insights said. Taiwan is one of two countries that uses 10-nanometer technology or better to produce wafers, holding 62.8 percent of global capacity, with South Korea holding the remaining 37.2
AGGRESSIVE STEP: With the new processors, Apple is aiming at the high-end chips Intel has provided for the MacBook Pro and other top-end Macs for about 15 years Apple Inc on Monday took the most aggressive step yet to strip Intel Corp chips from its computers, announcing more powerful homegrown Mac processors alongside a total revamp of its MacBook Pro laptop computers. The company showcased the chips at an event called “Unleashed,” which also included its latest audio products. The new components, called the M1 Pro and M1 Max chips, are 70 percent faster than its M1 predecessors, Apple said. It also unveiled a redesigned MacBook Pro, adding larger screens, MagSafe charging and better resolution. With the new processors and devices, Apple is aiming squarely at the high-end chips that Intel has
PRICE SPREAD: Oil trading under the Brent futures contract is giving the US a hefty edge in pricing, increasing the rush to secure cheap fuel as winter approaches Asian demand for US oil is rising as the energy crisis boosts prices for other crudes that are priced against the global Brent futures contract. China and other Asian buyers have been snapping up supertankers of US oil for delivery next month and seeking more for December, some traders have said. Most buyers are seeking US grades that had recently slumped to the lowest levels in more than a year, with an added incentive after Beijing awarded millions of tonnes of crude oil import quotas. A wide spread between Brent and West Texas Intermediate (WTI) oil futures is accommodating higher US crude