European stocks rose to a four-week high amid optimism the Bank of Japan’s (BOJ) stimulus would fill some of the gap left by the end of US Federal Reserve bond buying.
The STOXX Europe 600 Index gained 1.8 percent to 336.8 at the close of trading on Friday, boosting its weekly advance to 2.9 percent, the most this year. Barclays PLC and BNP Paribas SA led lenders higher, as all 19 industry groups on the gauge climbed.
The equity benchmark dropped 1.8 percent last month, the most since June last year, amid concern that the European Central Bank’s (ECB) asset purchases would not be enough to revive the region’s economy. With the US Federal Reserve ending purchases this month, investors are turning to Europe and Japan for sustained support.
The BOJ unexpectedly boosted its stimulus, raising its annual target for monetary expansion to ￥80 trillion (US$717 billion), up from ￥60 trillion to ￥70 trillion.
“Markets don’t really seem to care about what kind of stimulus we get or where it’s coming from, as long we get something,” said Teis Knuthsen, chief investment officer at Saxo Bank A/S’s private-banking unit.
“Central banks are trying to squeeze money into the system and as long as economic growth is good enough, all that money will be going into financial assets. What happened in Japan is very powerful for equities, and it’s really rippling throughout global markets,” Knuthsen added.
Investors weighed a report that showed euro-area inflation increased this month for clues about the ECB’s policy stance at its meeting next week. The central bank aims to take inflation closer to 2 percent, while the rate has stayed below 1 percent for a year.
Benchmark indices in 16 of the 18 Western European markets rose on Friday. The UK’s FTSE 100 gained 1.3 percent, while France’s CAC 40 advanced 2.2 percent. Germany’s DAX rallied 2.3 percent.
Barclays rallied 8.2 percent to ￡2.408 for its biggest increase since February last year, after saying it is confident of reaching the leverage ratio set by the Bank of England. The central bank on Friday set a minimum level of 4.05 percent from 2019, lower than analysts estimated.
BNP Paribas rose 3.5 percent to 50.14 euros after posting an 11 percent gain in third-quarter profit that exceeded analysts’ estimates. Net income was 1.5 billion euros (US$1.89 billion), up from 1.36 billion euros a year earlier, the lender said. Loan-loss provisions fell 9.2 percent.
PERSISTENT RUMORS: Nvidia’s CEO said the firm is not in talks to sell AI chips to China, but he would welcome a change in US policy barring the activity Nvidia Corp CEO Jensen Huang (黃仁勳) said his company is not in discussions to sell its Blackwell artificial intelligence (AI) chips to Chinese firms, waving off speculation it is trying to engineer a return to the world’s largest semiconductor market. Huang, who arrived in Taiwan yesterday ahead of meetings with longtime partner Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), took the opportunity to clarify recent comments about the US-China AI race. The Nvidia head caused a stir in an interview this week with the Financial Times, in which he was quoted as saying “China will win” the AI race. Huang yesterday said
Japanese technology giant Softbank Group Corp said Tuesday it has sold its stake in Nvidia Corp, raising US$5.8 billion to pour into other investments. It also reported its profit nearly tripled in the first half of this fiscal year from a year earlier. Tokyo-based Softbank said it sold the stake in Silicon Vally-based Nvidia last month, a move that reflects its shift in focus to OpenAI, owner of the artificial intelligence (AI) chatbot ChatGPT. Softbank reported its profit in the April-to-September period soared to about 2.5 trillion yen (about US$13 billion). Its sales for the six month period rose 7.7 percent year-on-year
MORE WEIGHT: The national weighting was raised in one index while holding steady in two others, while several companies rose or fell in prominence MSCI Inc, a global index provider, has raised Taiwan’s weighting in one of its major indices and left the country’s weighting unchanged in two other indices after a regular index review. In a statement released on Thursday, MSCI said it has upgraded Taiwan’s weighting in the MSCI All-Country World Index by 0.02 percentage points to 2.25 percent, while maintaining the weighting in the MSCI Emerging Markets Index, the most closely watched by foreign institutional investors, at 20.46 percent. Additionally, the index provider has left Taiwan’s weighting in the MSCI All-Country Asia ex-Japan Index unchanged at 23.15 percent. The latest index adjustments are to
CRESTING WAVE: Companies are still buying in, but the shivers in the market could be the first signs that the AI wave has peaked and the collapse is upon the world Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday reported a new monthly record of NT$367.47 billion (US$11.85 billion) in consolidated sales for last month thanks to global demand for artificial intelligence (AI) applications. Last month’s figure represented 16.9 percent annual growth, the slowest pace since February last year. On a monthly basis, sales rose 11 percent. Cumulative sales in the first 10 months of the year grew 33.8 percent year-on-year to NT$3.13 trillion, a record for the same period in the company’s history. However, the slowing growth in monthly sales last month highlights uncertainty over the sustainability of the AI boom even as
RSS