US stock markets climbed steadily, if unspectacularly, this week, nearing three-year highs despite worry over rising oil prices and Europe’s slow boil debt crisis.
“Stocks were in a bear market from October 2007 until March 2009,” said Beth Ann Bovino of Standard & Poor’s (S&P). “They have now recovered much of those losses.”
The holiday-shortened week saw the Dow Jones Industrial Average hover above the symbolic threshold of 13,000 points, helping add to confidence about the growing economy and falling unemployment.
At the end of the week, the Dow was up 0.3 percent at 12,982.95 points. The NASDAQ rose 0.4 percent and the S&P 500 rose 0.3 percent.
“A stronger job market is helping the US weather headwinds from both home and abroad,” said economists at Nomura, a Japanese bank.
One of those headwinds is higher oil prices, which have been rising on tensions in Iran.
While prices have been on the rise for some time, there was renewed focus this week as US politicians talked extensively about what can be done to stem the rise in this election year.
“Oil prices are on the rise again and concerns are growing about their impact on the recovery,” IHS Global Insight economists Paul Edelstein said.
“The situation is reminiscent of early-2011, when Brent oil prices reached US$126 a barrel, creating a growth pocket in the middle of the year,” he said.
“If oil prices stay persistently high or continue to rise, growth forecasts will likely be revised downward, but it would take a much bigger spike in prices to sink the US economy back into recession,” he said.
Higher oil prices spelled a boon for the oil majors. ExxonMobil was up 2 percent for the week, and Chevron was up 2.3 percent
Airlines got the raw end of that trade. US Airways plunged 21 percent, United Continental 13 percent and Delta 12 percent for the week.
In other sectors Wal-Mart saw steep declines, down 5.9 percent following disappointing quarterly earnings. Hewlett-Packard suffered a nearly 10 percent drop after reporting a 44 percent profit fall in its fiscal first quarter.
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
IN THE AIR: While most companies said they were committed to North American operations, some added that production and costs would depend on the outcome of a US trade probe Leading local contract electronics makers Wistron Corp (緯創), Quanta Computer Inc (廣達), Inventec Corp (英業達) and Compal Electronics Inc (仁寶) are to maintain their North American expansion plans, despite Washington’s 20 percent tariff on Taiwanese goods. Wistron said it has long maintained a presence in the US, while distributing production across Taiwan, North America, Southeast Asia and Europe. The company is in talks with customers to align capacity with their site preferences, a company official told the Taipei Times by telephone on Friday. The company is still in talks with clients over who would bear the tariff costs, with the outcome pending further
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
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