European stocks declined for a second week as higher oil dimmed the earnings outlook for automakers and retailers and concerns deepened that banks will report more losses.
Bayerische Motoren Werke AG and Carrefour SA, the world’s second-largest retailer, declined more than 3 percent as oil soared as much as US$8.27 a barrel this week. Anglo Irish Bank Plc led a retreat in financial shares as Citigroup Inc predicted three US investment banks will write down a combined US$6.4 billion this quarter and speculation mounted that a government bailout of Fannie Mae and Freddie Mac would leave the shares worthless.
The Dow Jones Stoxx 600 Index lost 1.2 percent to 283.82 this week, extending its slump this year to 22 percent. Financial firms have led the decline on concerns that accelerating inflation and more than US$500 billion in credit-related losses will stifle profits.
“After all the bad things we’ve had this week, the oil price is shaking the market again,” said Roger Kunz, head of investment strategy at Clariden Leu in Zurich, Switzerland, which manages the equivalent of US$120 billion in assets. “Markets are extremely nervous at the moment. That’s why they react very negatively, because the situation remains very fragile.”
National benchmark indexes declined in 15 of the 18 western European markets. Germany’s DAX slipped 1.6 percent and France’s CAC 40 fell 1.2 percent. A rally in commodity producers sent the UK’s FTSE 100 0.9 percent higher.
BMW, the world’s largest maker of luxury cars, fell 3.2 percent while Porsche SE, the maker of the 911 sports car, retreated 2.4 percent. Carrefour lost 5.6 percent and Metro AG, Germany’s largest retailer, slid 5 percent.
Crude oil rose as much as 7.3 percent this week in New York as a weakening dollar revived demand for raw materials as alternative investments. The Reuters/Jefferies CRB Index of 19 commodities soared 3.7 percent to a three-week high of 405.92 in New York on Thursday.
Anglo Irish, Ireland’s third-largest lender by market value, lost 15 percent while Royal Bank of Scotland Plc, the UK’s second- biggest bank, fell 5.2 percent. The Dow Jones Stoxx Banks Index dropped 4 percent this week, extending its slump this year to 32 percent.
Citigroup analyst Prashant Bhatia cut his third-quarter earnings estimates for Lehman Brothers Holdings Inc, Goldman Sachs Group Inc and Morgan Stanley. Separately, JPMorgan Chase & Co said Lehman may write down about US$4 billion in credit-related investments this quarter as the mortgage market deteriorates.
Billionaire Warren Buffett told CNBC that Fannie Mae and Freddie Mac “don’t have any net worth.”
The government is aiming to recruit 1,096 foreign English teachers and teaching assistants this year, the Ministry of Education said yesterday. The foreign teachers would work closely with elementary and junior-high instructors to create and teach courses, ministry official Tsai Yi-ching (蔡宜靜) said. Together, they would create an immersive language environment, helping to motivate students while enhancing the skills of local teachers, she said. The ministry has since 2021 been recruiting foreign teachers through the Taiwan Foreign English Teacher Program, which offers placement, salary, housing and other benefits to eligible foreign teachers. Two centers serving northern and southern Taiwan assist in recruiting and training
WIDE NET: Health officials said they are considering all possibilities, such as bongkrekic acid, while the city mayor said they have not ruled out the possibility of a malicious act of poisoning Two people who dined at a restaurant in Taipei’s Far Eastern Department Store Xinyi A13 last week have died, while four are in intensive care, the Taipei Department of Health said yesterday. All of the outlets of Malaysian vegetarian restaurant franchise Polam Kopitiam have been ordered to close pending an investigation after 11 people became ill due to suspected food poisoning, city officials told a news conference in Taipei. The first fatality, a 39-year-old man who ate at the restaurant on Friday last week, died of kidney failure two days later at the city’s Mackay Memorial Hospital. A 66-year-old man who dined
‘CARRIER KILLERS’: The Tuo Chiang-class corvettes’ stealth capability means they have a radar cross-section as small as the size of a fishing boat, an analyst said President Tsai Ing-wen (蔡英文) yesterday presided over a ceremony at Yilan County’s Suao Harbor (蘇澳港), where the navy took delivery of two indigenous Tuo Chiang-class corvettes. The corvettes, An Chiang (安江) and Wan Chiang (萬江), along with the introduction of the coast guard’s third and fourth 4,000-tonne cutters earlier this month, are a testament to Taiwan’s shipbuilding capability and signify the nation’s resolve to defend democracy and freedom, Tsai said. The vessels are also the last two of six Tuo Chiang-class corvettes ordered from Lungteh Shipbuilding Co (龍德造船) by the navy, Tsai said. The first Tuo Chiang-class vessel delivered was Ta Chiang (塔江)
EYE ON STRAIT: The US spending bill ‘doubles security cooperation funding for Taiwan,’ while also seeking to counter the influence of China US President Joe Biden on Saturday signed into law a US$1.2 trillion spending package that includes US$300 million in foreign military financing to Taiwan, as well as funding for Taipei-Washington cooperative projects. The US Congress early on Saturday overwhelmingly passed the Further Consolidated Appropriations Act 2024 to avoid a partial shutdown and fund the government through September for a fiscal year that began six months ago. Under the package, the Defense Appropriations Act would provide a US$27 billion increase from the previous fiscal year to fund “critical national defense efforts, including countering the PRC [People’s Republic of China],” according to a summary