European stocks declined on the first trading day of the year after completing their smallest annual advance since 1992 over the past year.
The STOXX Europe 600 Index slipped 0.4 percent to 341.33 at the close of trading on Friday, paring earlier losses of as much as 0.7 percent. The gauge had earlier risen as much as 0.6 percent before falling as a measure of eurozone manufacturing expanded less last month than initially estimated.
The number of shares changing hands in STOXX 600-listed companies was 36 percent lower than the average of the past 30 days, data compiled by Bloomberg showed.
The Swiss market was closed for a holiday.
Strategists forecast advances for European stocks through the end of this year, amid bets that European Central Bank President Mario Draghi will step up measures to support the economy.
Draghi told German newspaper Handelsblatt that he cannot exclude the risk of deflation in the eurozone, suggesting that the likelihood of large-scale quantitative easing is increasing.
“As long as central banks continue to aggressively try to jumpstart their growth rates then we should be fairly confident going into 2015,” said Thomas Thygesen, head of cross-asset strategy at Skandinaviska Enskilda Banken AB in Copenhagen.
Still, “there are plenty of things in the first quarter that could unsettle such a scenario. Many tripwires have been laid out. If oil prices do not stabilize, for example, I think many people will start to feel the heat in a different way,” he added.
A measure of energy companies added 0.1 percent on Friday after slumping 15 percent last year, the most among the 19 industry groups in the STOXX 600.
A final reading of a purchasing managers’ index for eurozone factory output stood at 50.6 last month, Markit Economics said. While that figure is up from a 17-month low of 50.1 in November, it is below a 50.8 estimate released on Dec. 16 and barely above the mark of 50 signaling expansion.
The STOXX 600 extended declines as a report from the Institute for Supply Management showed that US manufacturing cooled last month. The group’s factory index fell to a six-month low of 55.5 from 58.7 in November.
European stocks rose for a third year last year, with a 4.4 percent gain. That compared with rallies of 17 percent in 2013 and 14 percent in 2012. Europe’s equity benchmark lost 1.4 percent last month — its first December decline since 2008, amid a slump in oil prices and in Greek equities.
Banks posted the best performance of the 19 industry groups on the equity benchmark. Portugal’s Banco Comercial Portugues SA led gains, climbing 7 percent, while Spain’s Banco Popular Espanol SA rose 6.4 percent and Italy’s Banca Popolare di Milano SCRL climbed 5.1 percent.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
TRANSFORMATION: Taiwan is now home to the largest Google hardware research and development center outside of the US, thanks to the nation’s economic policies President Tsai Ing-wen (蔡英文) yesterday attended an event marking the opening of Google’s second hardware research and development (R&D) office in Taiwan, which was held at New Taipei City’s Banciao District (板橋). This signals Taiwan’s transformation into the world’s largest Google hardware research and development center outside of the US, validating the nation’s economic policy in the past eight years, she said. The “five plus two” innovative industries policy, “six core strategic industries” initiative and infrastructure projects have grown the national industry and established resilient supply chains that withstood the COVID-19 pandemic, Tsai said. Taiwan has improved investment conditions of the domestic economy
MAJOR BENEFICIARY: The company benefits from TSMC’s advanced packaging scarcity, given robust demand for Nvidia AI chips, analysts said ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip packaging and testing service provider, yesterday said it is raising its equipment capital expenditure budget by 10 percent this year to expand leading-edge and advanced packing and testing capacity amid strong artificial intelligence (AI) and high-performance computing chip demand. This is on top of the 40 to 50 percent annual increase in its capital spending budget to more than the US$1.7 billion to announced in February. About half of the equipment capital expenditure would be spent on leading-edge and advanced packaging and testing technology, the company said. ASE is considered by analysts