European stocks climbed for a third straight week amid takeover activity and corporate earnings that surpassed analysts’ estimates.
AstraZeneca PLC surged 18 percent as Pfizer Inc sweetened its bid for the UK’s second-biggest drugmaker. Alstom SA jumped 10 percent as General Electric Co made an offer for the French company’s energy business. Royal Bank of Scotland Group PLC climbed 9.4 percent after posting quarterly profits that exceeded projections.
The STOXX Europe 600 Index added 1.3 percent to 337.76 in a shortened holiday week for its biggest increase in a month. The benchmark equity gauge rallied 1.1 percent last month, following a decline in March.
The index closed within 0.4 percent of the six-year high it reached on April 4.
“M&A [merger and acquisition] is helping the market,” Louis de Fels, a Paris-based fund manager at Raymond James Financial Inc, said in an interview. “US companies have a lot of cash, and they want to use it in Europe, so it is positive for the European market.”
National benchmark indices rose in 16 of the 18 Western European markets this week. The UK’s FTSE 100 advanced 2.1 percent, while Germany’s DAX added 1.6 percent. France’s CAC 40 gained 0.3 percent. Most European markets were closed on Thursday for a holiday.
M&A announcements, coupled with better-than-expected earnings, offset concern over the Ukraine crisis. The US and the EU imposed new asset freezes and travel bans on people close to Russian President Vladimir Putin and some of their companies. Ukraine sent armored vehicles and artillery to retake Slovyansk, a stronghold for pro-separatist forces, defying Putin’s demand to pull back troops.
AstraZeneca surged 18 percent as Pfizer sweetened its bid to £63.1 billion (US$106 billion). AstraZeneca rejected the proposal on Friday, saying the offer fails to recognize the value of promising experimental medicines under development.
DECOUPLING? In a sign of deeper US-China technology decoupling, Apple has held initial talks about using Baidu’s generative AI technology in its iPhones, the Wall Street Journal said China has introduced guidelines to phase out US microprocessors from Intel Corp and Advanced Micro Devices Inc (AMD) from government PCs and servers, the Financial Times reported yesterday. The procurement guidance also seeks to sideline Microsoft Corp’s Windows operating system and foreign-made database software in favor of domestic options, the report said. Chinese officials have begun following the guidelines, which were unveiled in December last year, the report said. They order government agencies above the township level to include criteria requiring “safe and reliable” processors and operating systems when making purchases, the newspaper said. The US has been aiming to boost domestic semiconductor
Nvidia Corp earned its US$2.2 trillion market cap by producing artificial intelligence (AI) chips that have become the lifeblood powering the new era of generative AI developers from start-ups to Microsoft Corp, OpenAI and Google parent Alphabet Inc. Almost as important to its hardware is the company’s nearly 20 years’ worth of computer code, which helps make competition with the company nearly impossible. More than 4 million global developers rely on Nvidia’s CUDA software platform to build AI and other apps. Now a coalition of tech companies that includes Qualcomm Inc, Google and Intel Corp plans to loosen Nvidia’s chokehold by going
ENERGY IMPACT: The electricity rate hike is expected to add about NT$4 billion to TSMC’s electricity bill a year and cut its annual earnings per share by about NT$0.154 Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has left its long-term gross margin target unchanged despite the government deciding on Friday to raise electricity rates. One of the heaviest power consuming manufacturers in Taiwan, TSMC said it always respects the government’s energy policy and would continue to operate its fabs by making efforts in energy conservation. The chipmaker said it has left a long-term goal of more than 53 percent in gross margin unchanged. The Ministry of Economic Affairs concluded a power rate evaluation meeting on Friday, announcing electricity tariffs would go up by 11 percent on average to about NT$3.4518 per kilowatt-hour (kWh)
OPENING ADDRESS: The CEO is to give a speech on the future of high-performance computing and artificial intelligence at the trade show’s opening on June 3, TAITRA said Advanced Micro Devices Inc (AMD) chairperson and chief executive officer Lisa Su (蘇姿丰) is to deliver the opening keynote speech at Computex Taipei this year, the event’s organizer said in a statement yesterday. Su is to give a speech on the future of high-performance computing (HPC) in the artificial intelligence (AI) era to open Computex, one of the world’s largest computer and technology trade events, at 9:30am on June 3, the Taiwan External Trade Development Council (TAITRA) said. Su is to explore how AMD and the company’s strategic technology partners are pushing the limits of AI and HPC, from data centers to