European stocks rallied for a second week as Republicans and Democrats agreed to raise the US sovereign-debt ceiling and reopen the federal government.
Hargreaves Lansdown PLC climbed to its highest since its initial public offering in 2007, posting the best performance on the STOXX Europe 600 Index this week. Man Group PLC jumped 10 percent after the world’s largest publicly traded hedge-fund manager posted its first quarterly net inflows in two years. PSA Peugeot Citroen slumped 13 percent as the company was said to consider selling shares to increase its capital.
The STOXX 600 advanced 2.2 percent to 318.47 this week. The equity benchmark has climbed for seven consecutive days, its longest winning streak this year. The gauge has risen 2.6 percent so far this month amid optimism that the US Congress would increase the limit before the deadline on Thursday. That extended the rally this year to 14 percent.
“The last-minute deal was widely expected by the markets, which was reflected in this week’s movements,” said Benedict Goette, CEO of Compass Capital AG in Zurich. “We may see an extension of the benign dynamic we currently seem to be in. The market will postpone any second thought on the US budget divide until its next deadline.”
National benchmark indices advanced in every Western European market except Iceland this week. Germany’s DAX and France’s CAC 40 rose 1.6 percent, while the UK’s FTSE 100 gained 2.1 percent.
US President Barack Obama on Thursday signed into law a measure to extend the nation’s borrowing authority into early next year and end the government shutdown that started on Oct. 1.
Investors were also encouraged by US Federal Reserve Bank of Chicago President Charles Evans’ comment on Thursday that the Fed should not begin reducing the pace of its US$85 billion monthly asset purchases because the government stopped publishing the data used to gauge the economy’s health during the shutdown.
Market optimism also rose on reports that the Chinese economy accelerated in the third quarter, with GDP rising 7.8 percent from a year earlier, the National Bureau of Statistics said on Friday. A separate release showed that industrial production advanced last month by 10.2 percent, matching economists’ estimates.
BUSINESS UPDATE: The iPhone assembler said operations outlook is expected to show quarter-on-quarter and year-on-year growth for the second quarter Hon Hai Precision Industry Co (鴻海精密) yesterday reported strong growth in sales last month, potentially raising expectations for iPhone sales while artificial intelligence (AI)-related business booms. The company, which assembles the majority of Apple Inc’s smartphones, reported a 19.03 percent rise in monthly sales to NT$510.9 billion (US$15.78 billion), from NT$429.22 billion in the same period last year. On a monthly basis, sales rose 14.16 percent, it said. The company in a statement said that last month’s revenue was a record-breaking April performance. Hon Hai, known also as Foxconn Technology Group (富士康科技集團), assembles most iPhones, but the company is diversifying its business to
ARTIFICIAL INTELLIGENCE: The chipmaker last month raised its capital spending by 28 percent for this year to NT$32 billion from a previous estimate of NT$25 billion Contract chipmaker Powerchip Semiconductor Manufacturing Corp (力積電子) yesterday launched a new 12-inch fab, tapping into advanced chip-on-wafer-on-substrate (CoWoS) packaging technology to support rising demand for artificial intelligence (AI) devices. Powerchip is to offer interposers, one of three parts in CoWoS packaging technology, with shipments scheduled for the second half of this year, Powerchip chairman Frank Huang (黃崇仁) told reporters on the sidelines of a fab inauguration ceremony in the Tongluo Science Park (銅鑼科學園區) in Miaoli County yesterday. “We are working with customers to supply CoWoS-related business, utilizing part of this new fab’s capacity,” Huang said, adding that Powerchip intended to bridge
Microsoft Corp yesterday said that it would create Thailand’s first data center region to boost cloud and artificial intelligence (AI) infrastructure, promising AI training to more than 100,000 people to develop tech. Bangkok is a key economic player in Southeast Asia, but it has lagged behind Indonesia and Singapore when it comes to the tech industry. Thailand has an “incredible opportunity to build a digital-first, AI-powered future,” Microsoft chairman and chief executive officer Satya Nadella said at an event in Bangkok. Data center regions are physical locations that store computing infrastructure, allowing secure and reliable access to cloud platforms. The global embrace of AI
Qualcomm Inc, the world’s biggest seller of smartphone processors, gave an upbeat forecast for sales and profit in the current period, suggesting demand for handsets is increasing after a two-year slump. Revenue in the three months ended in June will be US$8.8 billion to US$9.6 billion, the company said in a statement Wednesday. Excluding certain items, earnings will be US$2.15 to US$2.35 a share. Analysts had projected sales of US$9.08 billion and earnings of US$2.16 a share. The outlook signals that the smartphone market has begun to bounce back, tracking with Qualcomm’s forecast that demand would gradually recover this year. The San