European stock-index futures increased after the STOXX Europe 600 Index completed its first back-to-back weekly losses since March, with the German benchmark gauge entering a correction.
Futures on the Euro STOXX 50 Index expiring in September climbed 0.3 percent to 3,023 at 7:20pm in London. The STOXX 600 lost 0.6 percent on Friday, posting a 2.1 percent decline for the week and closing at its lowest level since March 24. The DAX Index dropped as much as 11 percent from its July 3 record, while France’s CAC 40 Index lost more than 10 percent in intraday trading from its six-year high in June.
European index futures rose after the close amid signs tension in Ukraine is easing. Interfax said military exercises near the Ukraine border are over, citing Russia’s defense ministry. Shares pared losses earlier after RIA Novosti reported that Russia seeks a de-escalation of the conflict in Ukraine.
US President Barack Obama’s authorization of air strikes against militants in Iraq late on Thursday accelerated a retreat in European stocks that started weeks ago. Concern over the crises in Ukraine and Israel, as well as shares from Europe’s periphery slumping after their rallies, have sent the Euro STOXX 50 of euro-area shares down as much as 10 percent in Friday’s trading from its high on June 19.
The Euro STOXX 50 dropped 2.1 percent this week, closing at its lowest level since March 14. It lost 1.2 percent on Thursday after European Central Bank President Mario Draghi said geopolitical risks in countries such as Ukraine could hurt the economic recovery. The gauge earlier on Friday fell as much as 1.2 percent, or down 10 percent from this year’s high. It rallied 83 percent from the low in March 2009 through June 19.
The STOXX 600 is down 7.1 percent from June 10, when it reached its highest level since January 2008.
Shares in Europe’s peripheral nations bore the brunt of the losses. The PSI 20 Index, Portugal’s national benchmark gauge, has slumped 30 percent since its almost three-year high in April and closed at a one-year low. The fallout of Banco Espirito Santo SA helped the gauge post this quarter’s biggest decline among 24 developed markets tracked by Bloomberg, reviving concerns over the health of the financial system.
Italy’s FTSE MIB Index has lost 15 percent since its June high, extending losses after a government report this week showed the nation’s economy fell into a recession in the first half of the year.
Greece’s ASE Index is down 24 percent from its high on March 18 and closed at its lowest level since October.
Obama authorized limited air strikes against Sunni militants in Iraq to protect US personnel and Yezidis, a minority group concentrated in the north of the country who have been targeted by militants and are stranded on a mountain.
“This just adds another geopolitical tension to a market that’s already surrounded in uncertainty, with Israel, Ukraine and now Iraq,” said Francois Savary, chief investment officer at Reyl & Cie in Geneva.
“The big question is whether this will provoke a slowdown in global economic activity, or even a recession, to the extent that you have to reassess the recovery. That’s impacting investors’ reasoning and creates all the conditions for volatility to increase,” he said.
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
EUROPE ON HOLD: Among a flurry of announcements, Intel said it would postpone new factories in Germany and Poland, but remains committed to its US expansion Intel Corp chief executive officer Pat Gelsinger has landed Amazon.com Inc’s Amazon Web Services (AWS) as a customer for the company’s manufacturing business, potentially bringing work to new plants under construction in the US and boosting his efforts to turn around the embattled chipmaker. Intel and AWS are to coinvest in a custom semiconductor for artificial intelligence computing — what is known as a fabric chip — in a “multiyear, multibillion-dollar framework,” Intel said in a statement on Monday. The work would rely on Intel’s 18A process, an advanced chipmaking technology. Intel shares rose more than 8 percent in late trading after the
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) has appointed Rose Castanares, executive vice president of TSMC Arizona, as president of the subsidiary, which is responsible for carrying out massive investments by the Taiwanese tech giant in the US state, the company said in a statement yesterday. Castanares will succeed Brian Harrison as president of the Arizona subsidiary on Oct. 1 after the incumbent president steps down from the position with a transfer to the Arizona CEO office to serve as an advisor to TSMC Arizona’s chairman, the statement said. According to TSMC, Harrison is scheduled to retire on Dec. 31. Castanares joined TSMC in