Wall Street stocks stumbled early in the week after China unexpectedly devalued its currency, but steadied thereafter on solid US data.
All three indices ended with gains for the week, with the Dow Jones Industrial Average adding 104.02 points (0.6 percent) to 17,477.40. The broad-based S&P 500 rose 13.97 (0.67 percent) to 2,091.54, while the tech-rich NASDAQ Composite Index increased 4.7 (0.09 percent) to 5,048.24.
FTN Financial chief economist Chris Low said initial “panic” over the Chinese policy receded as the week wore on.
“People are beginning to realize that perhaps they overreacted, but China has dominated conversations,” he said.
The Dow lost more than 200 points on Tuesday after China’s central bank devalued its yuan currency by nearly 2 percent against the US dollar, as authorities said they were seeking to push market reforms, in the context of a slowing economy.
That move and further devaluations in subsequent days raised concerns about a strengthening US dollar and whether the Chinese economy is weaker than thought.
Analysts also rued a potential “currency war” if other economies seek to devalue currencies.
However, China’s central bank soothed markets on Friday by setting the daily reference rate of the yuan against the US dollar marginally higher, ending an almost 5 percent fall over three days.
US data showed a solid gain in industrial production and higher wholesale prices. The most anticipated report, last month’s retail sales, rose 0.6 percent behind large gains in auto purchasing and advances in most other categories.
While retail sales bested analyst expectations, a batch of earnings from large companies in the sector sent conflicting signals.
On the weak end was Macy’s Inc, which reported a 25.7 percent drop in second-quarter earnings to US$217 million, missing expectations by a wide margin.
Much better were results from the upscale department store chain Nordstrom Inc, which lifted its outlook for the year following a 15.3 percent rise in second-quarter earnings to US$211 million behind higher sales.
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],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
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