European stocks posted their biggest weekly decline since June as better-than-estimated US economic reports spurred speculation that the US Federal Reserve will begin cutting stimulus measures sooner than forecast.
ThyssenKrupp AG slumped 9.3 percent after Germany’s largest steelmaker raised 882.3 million euros (US$1.21 billion) through a share sale, while Standard Chartered PLC lost 8.1 percent.
On the winning side this week were Sage Group PLC, the UK’s biggest software maker, which rose 6.8 percent after reporting revenue growth that exceeded analysts’ estimates, as well as AZ Electronic Materials SA, which surged 43 percent after Merck KGaA agreed to buy it for about ￡1.6 billion (US$2.6 billion).
The STOXX Europe 600 Index fell 2.7 percent to 316.5 this week. The regional benchmark gauge has still surged 13 percent this year as EU central banks pledged to continue their support for economic growth.
The Euro STOXX 50 Index, a measure for the eurozone, lost 3.5 percent this week.
“Strong employment data means tapering comes sooner, but you also don’t want weak numbers,” Andreas Nigg, head of equity and commodity strategy at Vontobel Asset Management in Zurich, Switzerland, said in a telephone interview.
National benchmark indices retreated in all 18 western European markets this week, except Iceland. Germany’s DAX lost 2.5 percent, while France’s CAC 40 slid 3.9 percent and the UK’s FTSE 100 slipped 1.5 percent for its fifth consecutive weekly retreat.
European markets pared weekly losses after data from the US Department of Labor on Friday showed payrolls increased by 203,000 last month, following a revised 200,000 advance in October.
The median forecast of 89 economists surveyed by Bloomberg called for a 185,000 advance last month. The report also showed that the US jobless rate dropped to a five-year low of 7 percent.
European Central Bank (ECB) President Mario Draghi said on Thursday that increased commodity prices, weaker domestic demand and slow export growth all posed downside risks to the outlook for the eurozone’s economy.
ECB officials kept the main refinancing rate unchanged at 0.25 percent, as predicted by every economist in a Bloomberg News survey.
In the UK, the Bank of England left its key interest rate at a record-low 0.5 percent, in line with its guidance on rates.
STEPPING UP: The firm has also asked employees to work in split shifts from this week and to halt all but essential overseas business travel from next month Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has implemented a remote work policy for employees not on production lines in an attempt to curb the spread of COVID-19, the world’s largest contract chipmaker said yesterday. This is the first time in the Hsinchu-based company’s history that it has launched a large-scale remote work policy, joining global technology companies, such as Apple Inc and Google, that encourage employees to work from home. The chipmaker has also asked employees to work in split shifts from this week, it said. As the number of virus infections continues to climb worldwide, TSMC has urged employees to halt unnecessary
A two-hour drive south of Amsterdam in Veldhoven, workers decked out head-to-toe in protective gear toil in vast assembly halls. Before entering the inner sanctuary of the facilities, they meticulously layer on masks, gloves and special socks. A single speck of dust or a hair can have devastating effects on production. The result of all this painstaking process is an environment that is 10,000 times more purified than outside. As COVID-19 grips the world, it might just be the safest place to work right now. The teams belong to ASML Holding NV, which holds a de facto monopoly on the industry of
DBS Bank Ltd yesterday hacked its GDP growth forecast for Taiwan this year to 0.9 percent, down from its estimate of 2.3 percent two months earlier, in light of the COVID-19 pandemic and increasing financial market volatility. The bank’s latest forecast was even lower than London-based IHS Markit Ltd’s estimate of 1 percent, while other research institutes’ projections range from 1.6 percent to 2.6 percent. Taiwan’s economic momentum is being negatively affected by the pandemic, DBS said. The rapid spread of the disease from Asia to Europe and the US has dampened the bank’s previous expectation of a “V-shaped” global rebound in the
DOWNSIDE RISKS: Firms have a ‘very low’ chance of boosting investment returns in the next two years, making it hard for them to improve their capitalization, an analyst said Taiwanese life insurers wanting to improve their capital structure face strong headwinds this year, given prolonged low interest rates and economic impacts derived from trade protectionism and the COVID-19 pandemic, Taiwan Ratings Corp (中華信評) said on Friday. The local life insurance sector also still has high asset risks and such risks are susceptible to market volatility, the local arm of Standard & Poor’s Global Ratings said. Since last year, major financial holding companies — including CTBC Financial Holding Co (中信金控), Cathay Financial Holding Co (國泰金控) and Shin Kong Financial Holding Co (新光金控) — have announced plans to raise fresh capital to