European stocks posted their biggest two-day advance in more than three weeks as US jobs data beat expectations.
The STOXX Europe 600 Index climbed 1.1 percent to 341.38 at the close of trading on Friday, trimming its weekly loss to 0.2 percent. A report from the US Department of Labor showed payrolls climbed by 255,000 last month, exceeding all forecasts in a Bloomberg survey, signaling that the world’s biggest economy is strengthening.
Stocks rebounded on Thursday after the Bank of England unveiled fresh stimulus measures to help the economy cope with the repercussions of the Brexit vote.
Optimism that central banks will do what is needed to protect economic growth and contain the fallout from the UK’s decision has sparked a tentative return of bullish sentiment, albeit amid low-volume trading.
The number of shares changing hands on the STOXX 600 yesterday was 29 percent below the 30-day average.
“It’s important that the US holds strong, as that also helped bring optimism back to markets,” said Dirk Thiels, head of investment management at KBC Asset Management in Brussels. “There’s a lot of hope that central banks can counter any downside to growth, especially after the Bank of England shot a pretty big torpedo yesterday. That’s very reassuring after so much talk that monetary stimulus had reached the end of its capacity.”
The UK’s FTSE 100 Index climbed 0.8 percent, after jumping the most since June on Thursday. The FTSE 250 mid-cap gauge finally recovered its Brexit losses on Friday.
Stocks in so-called peripheral markets posted the biggest advances, with Italy’s FTSE MIB Index jumping 2.4 percent, Ireland’s ISEQ Index adding 1.8 percent and Spain’s IBEX 35 Index gaining 1.8 percent.
Among shares moving on corporate news, Evonik Industries AG rose 4.9 percent after the chemical manufacturer reported a smaller-than-projected drop in quarterly earnings.
LafargeHolcim Ltd jumped 5 percent as second-quarter earnings improved more than analysts expected and the cement producer pledged to sell more assets. Hugo Boss AG added 7.4 percent after the German fashion company posted better-than-expected revenue.
Allianz SE slipped 1.4 percent after the insurer said that second-quarter profit fell by almost half, missing analysts’ estimates, amid higher claims arising from natural disasters and charges for the sale of its South Korean unit.
Royal Bank of Scotland Group PLC declined 7.2 percent after the British lender posted another loss and said it would probably take even longer than expected to reach profitability targets.
Novo Nordisk A/S tumbled 10 percent as the biggest maker of insulin trimmed its forecasts for annual sales and profit amid intensifying pricing pressure in the US.
‘BIG LOSS’: This year might see the last generation of Huawei’s Kirin chips, as their production would stop next month because they are made using US technology Chinese tech giant Huawei Technologies Co (華為) is running out of processor chips to make smartphones due to US sanctions and would be forced to stop production of its own most advanced chips, a company executive has said, in a sign of growing damage to Huawei’s business from US pressure. Huawei, one of the biggest producers of smartphones and network equipment, is at the center of US-Chinese tension over technology and security. Washington last year cut off Huawei’s access to US components and technology, and those penalties were tightened in May, when the White House barred vendors worldwide from using US
’WHITE BOX’: The open platform would give local firms access to Cisco’s cloud-based mobile network to develop 5G telecom equipment and tap into the global market The Ministry of Economic Affairs (MOEA) yesterday introduced a new 5G “open lab” in collaboration with US-based information technology and networking giant Cisco Systems Inc to address the rapidly growing “white box” 5G networking equipment market. The open lab will be a platform where Taiwanese manufacturers can access Cisco’s cloud-based mobile network to develop their own 5G telecom equipment, such as small-cell base stations, network switches, modems and Internet of things (IoT) devices, a ministry statement said. The open platform would allow Taiwanese manufacturers to tap into the lucrative 5G telecom equipment market, which was previously monopolized by Nokia Oyj, Ericsson AB
Nintendo Co is raising its target for Switch production to about 25 million units this fiscal year, people familiar with the matter said, as the ongoing COVID-19 pandemic keeps lifting demand and component shortages ease. The Kyoto, Japan-based company, which in April hiked orders to 22 million units by March next year, is asking partners to tack on another few million units, said the people, who did not want to be identified discussing internal goals. Assembly partners plan to work at maximum capacity through December. The new production target suggests that Nintendo is likely to outperform its Switch sales forecast of 19 million
CORPORATE SCANDAL: Cathay Life has invested NT$13.3 billion in Bank Mayapada since 2015, but the latest loss of NT$8.8 billion has completely written off its investment Cathay Life Insurance Co (國泰人壽) yesterday said it would recognize an investment loss of NT$8.8 billion (US$298.1 million) in Indonesia’s Bank Mayapada Internasional Tbk PT due to concerns about the lender’s operations amid a corporate scandal. The company said it would revise its earnings result for June, from a net profit of NT$6.52 billion to a net loss of NT$520 million, its first monthly loss over the past 17 months. After booking an investment loss of NT$5.2 billion in Bank Mayapada earlier this year, Cathay Life has so far recognized total investment losses of NT$14 billion in the lender, executive vice president