European stocks dropped for a third straight week, the longest stretch of losses since March, as concern mounted that the economy won’t recover soon.
Volkswagen AG slumped 6.3 percent, leading declines in automakers, after US car sales fell in June and Credit Suisse Group AG cut its assessment of the industry. ThyssenKrupp AG, Germany’s largest steelmaker, and Finland’s Outokumpu Oyj dropped more than 3 percent as an industry group said European steel consumption will fall this year.
The Dow Jones STOXX 600 Index fell 0.2 percent this week to 204.08 after reports showed unemployment in Europe and the US rose.
The measure has fallen 4.8 percent since June 12 on speculation share prices have outpaced the outlook for economic growth after a three-month rally pushed valuations to 25.4 times earnings, near the highest level since 2004. The benchmark index for European equities still rose 17 percent in the second quarter, the biggest gain since 1999.
“Macroeconomic data are still disappointing and show economic recovery is not yet a reality,” said Emmanuel Soupre, who helps manage about US$18 billion at Neuflize OBC in Paris.
“We are going to keep fluctuating between optimism and pessimism in the months to come,” Soupre said.
Unemployment in the 16-member euro region increased to 9.5 percent in May from a revised 9.3 percent in April, the EU statistics office in Luxembourg said last week. The US unemployment rate rose to 9.5 percent last month, the highest since August 1983.
Bank shares were the best-performing group in the STOXX 600 this week, adding 1.2 percent. Barclays PLC, the UK’s third-biggest bank, rallied 11 percent.
UK consumer confidence increased to the highest level in 14 months last month as shoppers became more optimistic that the worst of the recession is over, GfK NOP said. Debenhams PLC, the UK’s second-largest department-store company, rose 12 percent.
A separate report showed confidence among US consumers slipped unexpectedly last month. The Conference Board’s sentiment index decreased to 49.3 from a revised 54.8 in May.
National benchmark indexes fell in eight of the 18 western European markets. The UK’s FTSE 100 slipped 0.1 percent, while Germany’s DAX dropped 1.4 percent. France’s CAC retreated 0.3 percent as PSA Peugeot Citroen and Renault SA declined.
European Central Bank (ECB) President Jean-Claude Trichet signaled the ECB has no immediate plans to cut interest rates again and said the euro region’s economy will start to recover in the middle of next year. The ECB kept its key lending rate at a record low of 1 percent.
Volkswagen slumped 6.3 percent as Europe’s largest carmaker said US sales last month fell 18 percent. Separately, German car production is expected to drop 17 percent this year, said Matthias Wissmann, the president of the country’s carmakers association, known as VDA.
LONG FLIGHT: The jets would be flown by US pilots, with Taiwanese copilots in the two-seat F-16D variant to help familiarize them with the aircraft, the source said The US is expected to fly 10 Lockheed Martin F-16C/D Block 70/72 jets to Taiwan over the coming months to fulfill a long-awaited order of 66 aircraft, a defense official said yesterday. Word that the first batch of the jets would be delivered soon was welcome news to Taiwan, which has become concerned about delays in the delivery of US arms amid rising military tensions with China. Speaking on condition of anonymity, the official said the initial tranche of the nation’s F-16s are rolling off assembly lines in the US and would be flown under their own power to Taiwan by way
OBJECTS AT SEA: Satellites with synthetic-aperture radar could aid in the detection of small Chinese boats attempting to illegally enter Taiwan, the space agency head said Taiwan aims to send the nation’s first low Earth orbit (LEO) satellite into space in 2027, while the first Formosat-8 and Formosat-9 spacecraft are to be launched in October and 2028 respectively, the National Science and Technology Council said yesterday. The council laid out its space development plan in a report reviewed by members of the legislature’s Education and Culture Committee. Six LEO satellites would be produced in the initial phase, with the first one, the B5G-1A, scheduled to be launched in 2027, the council said in the report. Regarding the second satellite, the B5G-1B, the government plans to work with private contractors
MISSION: The Indo-Pacific region is ‘the priority theater,’ where the task of deterrence extends across the entire region, including Taiwan, the US Pacific Fleet commander said The US Navy’s “mission of deterrence” in the Indo-Pacific theater applies to Taiwan, Pacific Fleet Commander Admiral Stephen Koehler told the South China Sea Conference on Tuesday. The conference, organized by the Center for Strategic and International Studies (CSIS), is an international platform for senior officials and experts from countries with security interests in the region. “The Pacific Fleet’s mission is to deter aggression across the Western Pacific, together with our allies and partners, and to prevail in combat if necessary, Koehler said in the event’s keynote speech. “That mission of deterrence applies regionwide — including the South China Sea and Taiwan,” he
‘NARWHAL’: The indigenous submarine completed its harbor acceptance test recently and is now under heavy guard as it undergoes tests in open waters, a source said The Hai Kun (海鯤), the nation’s first indigenous defense submarine, yesterday began sea trials, sailing out of the Port of Kaohsiung, a military source said. Also known as the “Narwhal,” the vessel departed from CSBC Corp, Taiwan’s (台灣國際造船) shipyard at about 8am, where it had been docked. More than 10 technicians and military personnel were on deck, with several others standing atop the sail. After recently completing its harbor acceptance test, the vessel has started a series of sea-based trials, including tests of its propulsion and navigational systems, while partially surfaced, the source said. The Hai Kun underwent tests in the port from
RSS