European stocks jumped from an eight-month low after US Federal Reserve Chair Janet Yellen said she was ready to raise interest rates this year, indicating that the recent market turmoil would not derail the US recovery.
Her comments helped clarify the Fed’s thinking, after the central bank’s decision to hold rates last week confused investors about the trajectory of US rates and increased stock volatility. Following a selloff on Thursday that wiped out its gains this year, the STOXX Europe 600 closed 2.8 percent higher on Friday.
All 19 industry groups rose at least 1 percent, and Germany’s DAX rebounded 2.8 percent from its lowest level since December. Italy’s FTSE MIB Index rallied the most among Western European markets, up 3.7 percent.
“It’s more of a relief rally supported by some clarity from Yellen,” said Carsten Hilck, a fund manager who oversees about US$6.6 billion at Union Investment in Frankfurt. “Markets will continue to be choppy, but they were clearly oversold in the past two days. Valuations started to get attractive. The DAX has been especially punished so we started buying German stocks yesterday.”
Europe’s benchmark gauge dropped 18 percent from a peak in April through Thursday, taking its valuation to 14.6 times estimated earnings, down from a multiple of 17.1 in July. Friday’s biggest advance in a month helped the STOXX 600 trim a second weekly decline. It was down 1.6 percent for the period as carmakers tumbled after Volkswagen AG said it cheated on US diesel-emission tests.
Volkswagen fell 3.8 percent, reversing an intraday advance of as much as 4.3 percent, after people familiar with the matter said executives in Germany controlled key aspects of the faked tests.
Other automakers clawed back losses on Friday, with BMW AG, Daimler AG and Renault SA rising 2.2 percent or more.
Some stocks moved on deal news. Quintain Estates & Development PLC jumped 7.6 percent after Lone Star Funds raised its offer for the housing developer and property investor. Sanofi added 3.1 percent as people familiar with the matter said the drugmaker might sell its biosurgery and renal units.
Synergy Health PLC soared 42 percent after a US judge denied a move by US officials to block the company’s takeover by Steris Corp, paving the way for a US$1.9 billion merger.
Adidas AG gained 4.1 percent after peer Nike Inc reported quarterly earnings that beat estimates. Zodiac Aerospace slid 6.8 percent after American Airlines Inc dropped the company as a supplier of seats on some of its planes, citing delivery delays.
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
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