European stocks had their biggest weekly decline in more than two months after a surge in crude oil to a record US$135 a barrel sparked concern that higher fuel costs will curb profits at airlines and automakers.
Air France-KLM Group tumbled the most since the week of Sept. 11, 2001, after Europe’s largest airline posted its first quarterly loss since 2003. British Airways PLC dropped the most in six months. Porsche SE led a retreat in carmakers as Merrill Lynch & Co recommended investors sell the shares and Ford Motor Co abandoned a target of returning to profit next year.
Europe’s Dow Jones STOXX 600 Index lost 3.3 percent to 319.02, the steepest weekly decline since March. The measure is down 13 percent this year as concern that record oil prices, inflation and US$383 billion in credit losses will curb economic expansion and profit growth.
“Investors are worried that this week’s spike in oil prices is a structural move, rather than just a temporary spike,” said Tony Dolphin, director of strategy and economics at Henderson Global Investors in London, which oversees about US$125 billion. “Unsurprisingly, the focus has been on those sectors where earnings would be hardest hit, such as airlines and autos.”
Crude oil for July delivery climbed more than 5 percent this week, touching US$135.09, the highest since trading began in 1983. Prices have doubled over the last year, aided by a falling US dollar and higher global demand for raw materials.
National benchmarks dropped in all 18 western European markets except Norway. Germany’s DAX Index slipped 3 percent, while France’s CAC 40 fell 2.8 percent and the UK’s FTSE 100 sank 3.4 percent. The STOXX 50 also declined 3.4 percent and the Euro STOXX 50, a measure for the euro region, slid 3.6 percent.
Investors may face further stock-market losses, options traders on the Eurex derivatives exchange said. The VDAX-New Index, which measures the cost of insuring against declines in the DAX, climbed 16 percent to 20.68, the highest in a month and the biggest weekly increase since January.
Beijing’s continued provocations in the Taiwan Strait reveal its intention to unilaterally change the “status quo” in the area, the US Department of State said on Saturday, calling for a peaceful resolution to cross-strait issues. The Coast Guard Administration (CGA) reported that four China Coast Guard patrol vessels entered restricted and prohibited waters near Kinmen County on Friday and again on Saturday. A State Department spokesperson said that Washington was aware of the incidents, and urged all parties to exercise restraint and refrain from unilaterally changing the “status quo.” “Maintaining peace and stability across the Taiwan Strait is in line with our [the
EXTENDED RANGE: Hsiung Sheng missiles, 100 of which might be deployed by the end of the year, could reach Chinese command posts and airport runways, a source said A NT$16.9 billion (US$534.93 million) project to upgrade the military’s missile defense systems would be completed this year, allowing the deployment of at least 100 long-range Hsiung Sheng missiles and providing more deterrence against China, military sources said on Saturday. Hsiung Sheng missiles are an extended-range version of the Hsiung Feng IIE (HF-2E) surface-to-surface cruise missile, and are believed to have a range of up to 1,200km, which would allow them to hit targets well inside China. They went into mass production in 2022, the sources said. The project is part of a special budget for the Ministry of National Defense aimed at
READY TO WORK: Taiwan is eager to cooperate and is hopeful that like-minded states will continue to advocate for its inclusion in regional organizations, Lai said Maintaining the “status quo” in the Taiwan Strait, and peace and stability in the Indo-Pacific region must be a top priority, president-elect William Lai (賴清德) said yesterday after meeting with a delegation of US academics. Leaders of the G7, US President Joe Biden and other international heads of state have voiced concerns about the situation in the Strait, as stability in the region is necessary for a safe, peaceful and prosperous world, Lai said. The vice president, who is to be inaugurated in May, welcomed the delegation and thanked them for their support for Taiwan and issues concerning the Strait. The international community
COOPERATION: Two crewmembers from a Chinese fishing boat that sank off Kinmen were rescued, two were found dead and another two were still missing at press time The Coast Guard Administration (CGA) was yesterday working with Chinese rescuers to find two missing crewmembers from a Chinese fishing boat that sank southwest of Kinmen County yesterday, killing two crew. The joint operation managed to rescue two of the boat’s six crewmembers, but two were already dead when they were pulled from the water, the agency said in a statement. Rescuers are still searching for two others from the Min Long Yu 61222, a boat registered in China’s Fujian Province that capsized and sank 1.03 nautical miles (1.9km) southwest of Dongding Island (東碇), it added. CGA Director-General Chou Mei-wu (周美伍) told a