European stocks fell for the first time in three weeks as the region’s economy shrank at the fastest pace in at least 13 years and Natixis SA and KBC Groep NV posted weaker-than-anticipated earnings.
Natixis and KBC led a retreat by banks, slumping more than 25 percent after posting quarterly losses. Land Securities Group PLC paced a decline among real-estate companies as it reported a record annual loss. HeidelbergCement AG tumbled 24 percent on speculation a debt-refinancing plan for the German cement maker is progressing too slowly.
The Dow Jones STOXX 600 Index lost 3.2 percent to 202.92 this week, the largest decline since the first week of March. Optimism that the global economy is recovering sent the gauge to the highest level since January last week and pushed valuations to a five-year high of 21.4 times the profits of its companies.
“The rally was on the back of some signs that the economic situation was stabilizing, reasonably cheap valuations and some short covering,” said Chirin Gill, a London-based fund manager at Daiwa SB Investments, which oversees US$60 billion. “We’ve seen some weakness this week on the back of some profit taking and worries that the economic recovery may not be as painless as the market is pricing in.”
National benchmark indexes fell in all of the 18 western European markets except Iceland. The UK’s FTSE 100 dropped 2.6 percent, paced by a slide in Rio Tinto Group and Lonmin PLC. France’s CAC 40 lost 4.3 percent and Germany’s DAX slid 3.6 percent.
Europe’s economy contracted 2.5 percent in the first quarter from the previous period as companies cut output and jobs to survive the worst global slump in more than six decades, according to the EU’s statistics office in Luxembourg.
The Bank of England this week said the UK economy faced a slow recovery.
NO-LIMITS PARTNERSHIP: ‘The bottom line’ is that if the US were to have a conflict with China or Russia it would likely open up a second front with the other, a US senator said Beijing and Moscow could cooperate in a conflict over Taiwan, the top US intelligence chief told the US Senate this week. “We see China and Russia, for the first time, exercising together in relation to Taiwan and recognizing that this is a place where China definitely wants Russia to be working with them, and we see no reason why they wouldn’t,” US Director of National Intelligence Avril Haines told a US Senate Committee on Armed Services hearing on Thursday. US Senator Mike Rounds asked Haines about such a potential scenario. He also asked US Defense Intelligence Agency Director Lieutenant General Jeffrey Kruse
INSPIRING: Taiwan has been a model in the Asia-Pacific region with its democratic transition, free and fair elections and open society, the vice president-elect said Taiwan can play a leadership role in the Asia-Pacific region, vice president-elect Hsiao Bi-khim (蕭美琴) told a forum in Taipei yesterday, highlighting the nation’s resilience in the face of geopolitical challenges. “Not only can Taiwan help, but Taiwan can lead ... not only can Taiwan play a leadership role, but Taiwan’s leadership is important to the world,” Hsiao told the annual forum hosted by the Center for Asia-Pacific Resilience and Innovation think tank. Hsiao thanked Taiwan’s international friends for their long-term support, citing the example of US President Joe Biden last month signing into law a bill to provide aid to Taiwan,
China’s intrusive and territorial claims in the Indo-Pacific region are “illegal, coercive, aggressive and deceptive,” new US Indo-Pacific Commander Admiral Samuel Paparo said on Friday, adding that he would continue working with allies and partners to keep the area free and open. Paparo made the remarks at a change-of-command ceremony at Joint Base Pearl Harbor-Hickam in Hawaii, where he took over the command from Admiral John Aquilino. “Our world faces a complex problem set in the troubling actions of the People’s Republic of China [PRC] and its rapid buildup of forces. We must be ready to answer the PRC’s increasingly intrusive and
STATE OF THE NATION: The legislature should invite the president to deliver an address every year, the TPP said, adding that Lai should also have to answer legislators’ questions The Chinese Nationalist Party (KMT) yesterday proposed inviting president-elect William Lai (賴清德) to make a historic first state of the nation address at the legislature following his inauguration on May 20. Lai is expected to face many domestic and international challenges, and should clarify his intended policies with the public’s representatives, KMT caucus secretary-general Hung Meng-kai (洪孟楷) said when making the proposal at a meeting of the legislature’s Procedure Committee. The committee voted to add the item to the agenda for Friday, along with another similar proposal put forward by the Taiwan People’s Party (TPP). The invitation is in line with Article 15-2