European stocks advanced for a second week as investors speculated that the EU will increase its efforts to contain the region’s debt crisis.
Banking shares posted their best weekly performance in six months.
The benchmark STOXX Europe 600 Index gained 1 percent this week as Portugal, Spain and Italy completed debt sales. The gauge rallied 8.6 percent last year as the EU bailed out Greece and Ireland, companies reported increased profits and the Federal Reserve unveiled US$600 billion in additional bond purchases to support the economy.
“The first test of the ability of the euro-area peripheral countries to secure financing on the market has been passed,” a team of economists at Intesa Sanpaolo SpA, including Luca Mezzomo and Paolo Mameli, wrote in a report. “The fears over the outcome of the January auctions in Portugal, Spain and Italy proved unfounded.”
The European Central Bank (ECB) kept interest rates at a record low as ECB President Jean-Claude Trichet said inflation pressures in the euro region have picked up. The Governing Council set the benchmark rate at 1 percent for the 21st month, as predicted by all 53 economists in a Bloomberg News survey. The Bank of England also kept its key rate unchanged at 0.5 percent.
National benchmark indexes rose in 15 of Europe’s 18 western markets. France’s CAC 40 Index gained 3 percent, the UK’s FTSE 100 Index rose 0.3 percent, while Germany’s DAX Index advanced 1.8 percent. Spain’s IBEX 35 Index jumped 8.6 percent, while Italy’s FTSE MIB Index surged 4.5 percent.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure