European stocks rallied for a third week, climbing to an 18-month high, amid increasing optimism that China’s economy will sustain its recovery and US lawmakers will reach a compromise to avoid a fiscal deadlock.
Rio Tinto Group led commodity shares higher, as Nokia Oyj gained 14 percent after winning a deal to sell its flagship smartphone in China. European Aeronautic, Defence & Space Co jumped 15 percent after announcing a new shareholder structure and unveiling a share buyback, while GDF Suez SA slid to a record low after saying earnings will decline next year.
The benchmark STOXX Europe 600 Index advanced 1.2 percent to 279.17 this week, the highest since May last year. The gauge has rallied 19 percent from this year’s low on June 4 as the European Central Bank and the US Federal Reserve expanded bond purchases, and US economic data beat estimates.
Republican defectors joined Democrats in signing a letter calling on US President Barack Obama and US House of Representatives Speaker John Boehner to explore “all options” to end an impasse over taxes on top earners. The US Congress must strike a budget deal before the New Year to prevent US$607 billion of automatic tax increases and spending cuts from coming into effect.
Obama said he is willing to make concessions in the talks if Republicans agree to consider taxes on the rich.
In China, the government under Chinese Vice President Xi Jinping (習近平) will keep macroeconomic policies stable, making adjustments as needed to deal with difficulties, a statement from the Chinese Communist Party’s politburo said.
The world’s second-largest economy will expand domestic demand, actively promote urbanization, strengthen real-estate controls and support small businesses, Xinhua news agency reported on Tuesday, citing the statement issued after a meeting of the ruling party’s top leaders.
In the eurozone, German Chancellor Angela Merkel hinted at the possibility that her country will eventually accept a writeoff of Greek debt. Greece made a 10 billion euro (US$13 billion) offer to buy back bonds.
A gauge of mining companies posted the biggest gain on the STOXX 600. Rio Tinto climbed 5.3 percent after Credit Suisse Group AG added the world’s second-largest mining company to its “Europe Focus” list. Kazakhmys PLCA rose 4.5 percent after saying it will start the development of the Aktogay copper project in Kazakhstan early next year.
Nokia rallied 14 percent after winning a deal with China Mobile Ltd (中國移動) to carry the Finnish mobile phone maker’s flagship smartphone, the Lumia 920T.
EADS jumped 15 percent after the company changed its ownership structure to allow Germany and France to each hold a 12 percent stake. EADS also said it will buy back as much as 15 percent of outstanding shares.
Stagecoach Group PLC, which owns 49 percent of Virgin Trains, advanced 5.9 percent. The company reported first-half pretax profits of ￡124 million (US$200 million), exceeding the average analyst estimate of ￡114 million.
Wincor Nixdorf AG, Europe’s biggest maker of automated teller machines, increased 6.8 percent. The company said it expects earnings before interest, taxes and amortization in 2014 to be higher than last year.
GDF Suez declined 12 percent — to the lowest price since it sold shares to the public in July 2005 — after Europe’s largest utility by market value forecast lower earnings next year and weakness in 2014. A gauge of utilities was one of the only two industry groups in the STOXX 600 to decline this week.
Tullow Oil PLCA slumped 9.6 percent after failing to make a commercial find at the Zaedyus-2 well off French Guiana in South America.
A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
On Ireland’s blustery western seaboard, researchers are gleefully flying giant kites — not for fun, but in the hope of generating renewable electricity and sparking a “revolution” in wind energy. “We use a kite to capture the wind and a generator at the bottom of it that captures the power,” said Padraic Doherty of Kitepower, the Dutch firm behind the venture. At its test site in operation since September 2023 near the small town of Bangor Erris, the team transports the vast 60-square-meter kite from a hangar across the lunar-like bogland to a generator. The kite is then attached by a
Foxconn Technology Co (鴻準精密), a metal casing supplier owned by Hon Hai Precision Industry Co (鴻海精密), yesterday announced plans to invest US$1 billion in the US over the next decade as part of its business transformation strategy. The Apple Inc supplier said in a statement that its board approved the investment on Thursday, as part of a transformation strategy focused on precision mold development, smart manufacturing, robotics and advanced automation. The strategy would have a strong emphasis on artificial intelligence (AI), the company added. The company said it aims to build a flexible, intelligent production ecosystem to boost competitiveness and sustainability. Foxconn
STILL UNCLEAR: Several aspects of the policy still need to be clarified, such as whether the exemptions would expand to related products, PwC Taiwan warned The TAIEX surged yesterday, led by gains in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US President Donald Trump announced a sweeping 100 percent tariff on imported semiconductors — while exempting companies operating or building plants in the US, which includes TSMC. The benchmark index jumped 556.41 points, or 2.37 percent, to close at 24,003.77, breaching the 24,000-point level and hitting its highest close this year, Taiwan Stock Exchange (TWSE) data showed. TSMC rose NT$55, or 4.89 percent, to close at a record NT$1,180, as the company is already investing heavily in a multibillion-dollar plant in Arizona that led investors to assume
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