European stocks climbed for a third straight week after the US Federal Reserve unexpectedly refrained from reducing its monthly bond purchases and former US Treasury secretary Larry Summers withdrew from consideration as chairman of the central bank.
The STOXX Europe 600 Index advanced 0.9 percent to 314.2 this week. The equity gauge has surged 5.7 percent this month, putting it on course for the biggest monthly gain in almost two years. The measure has climbed 12 percent this year, as the euro area emerged from recession and central banks pledged to keep borrowing costs low to support the global economy.
“The lack of tapering was a real surprise,” Philip Dicken, head of European equities at Threadneedle Asset Management in London, said by phone. “It signals that if the Fed is at all worried about growth, they will not use tapering if it will choke off that growth. It’s another net positive for European equities, where life is getting incrementally better.”
The STOXX 600 climbed to its highest level since June 2008 on Thursday, a day after the Fed said it needed to see more evidence of lasting improvement in the US economy before slowing bond purchases. Forty-four of 64 economists surveyed by Bloomberg before the decision had predicted that the central bank would start tapering stimulus measures this month.
The Fed repeated guidance that its target interest rate would remain low for at least as long as unemployment exceeds 6.5 percent, and the outlook for inflation remains no higher than 2.5 percent.
Stocks worldwide also rallied this week after Summers withdrew from the running to replace Bernanke, paving the way for Fed Vice Chairperson Janet Yellen, who investors say will favor slower stimulus reduction.
The Bank of England released this week the minutes from its Sept. 4 and 5 meeting, which showed that officials unanimously concluded there was no need for additional stimulus given the improving outlook for the British economy.
The VSTOXX Index, a measure of expected volatility in euro-area stocks, slid 8.8 percent to 16.76 this week, the lowest level in a month. National benchmark indices rose in 16 of the 18 Western European markets. Germany’s DAX added 2 percent, France’s CAC 40 rose 2.2 percent and the UK’s FTSE 100 gained 0.2 percent.
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
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
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],”
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