European shares on Friday closed at their highest level in five months as investors cheered positive signs on US-China trade talks and British lawmakers’ vote to request a delay in a potentially chaotic exit from the EU.
The pan-European STOXX 600 on Friday closed up 2.58 points, or 0.7 percent, at 381.10, its highest close since Oct. 4 last year and its biggest gain in a month. That was also a jump of 2.8 percent from a close of 370.57 on March 8.
All major regional bourses were in positive territory on Friday, led by Paris’ CAC 40, which gained 55.55 points, or 1 percent, to 5,405.32, surging 3.3 percent from 5,231.22 a week earlier.
London’s FTSE 100 on Friday rose 42.85 points, or 0.6 percent, to 7,228.28, an increase of 1.7 percent from a close of 7,104.31 on March 8, lifted by heavyweight oil and mining stocks that were boosted by higher metal and crude oil prices.
Germany’s trade-sensitive DAX was on Friday up 98.22 points, or 0.9 percent, at 11,685.69, jumping 2 percent from 11,457.84 a week earlier.
Turnover picked up on Friday after being generally in line with long-term averages in recent sessions — STOXX 600 volume was almost double its 90-day average as investors rushed to position themselves ahead of another critical Brexit week.
The mood was boosted by growing expectations that Britain will not leave the EU on March 29 without a deal to minimize economic disruption following parliamentary votes on Thursday night.
London’s domestically focused mid-cap index rose 1.1 percent as sterling rallied in late trading.
Thursday night’s votes saw British Prime Minister Theresa May’s government narrowly avert an attempt by lawmakers to seize the agenda next week if no Brexit deal has been passed, with the aim of forcing a discussion of alternative options before an EU summit on Thursday next week.
She plans to put her deal to the vote for a third time before then.
Investor confidence was also bolstered by news from China’s state-run Xinhua news agency that Washington and Beijing were making further substantive progress on trade talks, as well as upbeat comments from US President Donald Trump.
Gains might be a little overdone given the uncertainty about the outcome of next week’s Brexit votes, a slowing of economic growth and that there has been little more than rhetoric around the US-China trade talks, asset manager Brooks MacDonald deputy chief investment officer Edward Park said.
“There are still quite a lot of moving parts [to Brexit],” he said.
Still, technology stocks, which are particularly exposed to China, rallied 2.6 percent, their best day in five months.
They were also boosted by better-than-expected results from US chipmaker and sector bellwether Broadcom Inc, stirring hopes that the industry is recovering from a slowdown in Apple Inc and smartphone demand that knocked earnings late last year.
STMicroelectronics NV topped the Milan bourse, Infineon Technologies AG jumped 3.9 percent and AMS AG rallied 7.1 percent.
Additional reporting by staff writer
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
China has claimed a breakthrough in developing homegrown chipmaking equipment, an important step in overcoming US sanctions designed to thwart Beijing’s semiconductor goals. State-linked organizations are advised to use a new laser-based immersion lithography machine with a resolution of 65 nanometers or better, the Chinese Ministry of Industry and Information Technology (MIIT) said in an announcement this month. Although the note does not specify the supplier, the spec marks a significant step up from the previous most advanced indigenous equipment — developed by Shanghai Micro Electronics Equipment Group Co (SMEE, 上海微電子) — which stood at about 90 nanometers. MIIT’s claimed advances last
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
GLOBAL ECONOMY: Policymakers have a choice of a small 25 basis-point cut or a bold cut of 50 basis points, which would help the labor market, but might reignite inflation The US Federal Reserve is gearing up to announce its first interest rate cut in more than four years on Wednesday, with policymakers expected to debate how big a move to make less than two months before the US presidential election. Senior officials at the US central bank including Fed Chairman Jerome Powell have in recent weeks indicated that a rate cut is coming this month, as inflation eases toward the bank’s long-term target of two percent, and the labor market continues to cool. The Fed, which has a dual mandate from the US Congress to act independently to ensure