European stocks posted their biggest weekly loss since November 2008, becoming the first major region to enter a market correction, as concern escalated that the US’ economic recovery is stalling.
The STOXX Europe 600 Index tumbled 9.9 percent to 238.88 this past week, the gauge’s lowest level in 13 months. The measure has declined 18 percent from this year’s high on Feb. 17 amid mounting speculation that Europe will fail to contain its sovereign debt crisis and that the economic recovery is faltering in the US.
The index this week extended losses from this year’s peak to more than 10 percent, a retreat known as a correction.
“Fears of an extension of the debt crisis to Spain and Italy have coupled with the US’ own debt problem and, in the last few days, the additional element of worsening of the economic statistics,” said Karim Bertoni, who helps oversee US$29 billion at Banque SYZ & Co in Geneva. “If data continues to slow down, then markets will be weak.”
The VStoxx Index, which measures the cost of protecting against a decline in shares on the Euro STOXX 50 Index, surged 42 percent this week to its highest level since June last year.
National benchmark indexes retreated in all 18 Western European markets. France’s CAC 40 Index slid 11 percent, the UK’s FTSE 100 Index dropped 9.8 percent, while Germany’s DAX declined 13 percent.
The European Central Bank (ECB) left interest rates unchanged on Thursday, as economic growth slows and the region’s debt crisis spreads to Italy and Spain. Bank officials kept the benchmark rate at 1.5 percent.
ECB President Jean-Claude Trichet signaled at a press conference in Frankfurt that the central bank has resumed bond purchases.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts