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.
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) on Wednesday said that a new chip manufacturing technology called “A16” is to enter production in the second half of 2026, setting up a showdown with longtime rival Intel over who can make the fastest chips. TSMC, the world’s biggest contract manufacturer of advanced computing chips and a key supplier to Nvidia and Apple, announced the news at a conference in Santa Clara, California, where TSMC executives said that makers of artificial intelligence (AI) chips will likely be the first adopters of the technology rather than a smartphone maker. Analysts said that the technologies announced on
NO RECIPROCITY: Taipei has called for cross-strait group travel to resume fully, but Beijing is only allowing people from its Fujian Province to travel to Matsu, the MAC said The Mainland Affairs Council (MAC) yesterday criticized an announcement by the Chinese Ministry of Culture and Tourism that it would lift a travel ban to Taiwan only for residents of China’s Fujian Province, saying that the policy does not meet the principles of reciprocity and openness. Chinese Deputy Minister of Culture and Tourism Rao Quan (饒權) yesterday morning told a delegation of Chinese Nationalist Party (KMT) lawmakers in a meeting in Beijing that the ministry would first allow Fujian residents to visit Lienchiang County (Matsu), adding that they would be able to travel to Taiwan proper directly once express ferry
CALL FOR DIALOGUE: The president-elect urged Beijing to engage with Taiwan’s ‘democratically elected and legitimate government’ to promote peace President-elect William Lai (賴清德) yesterday named the new heads of security and cross-strait affairs to take office after his inauguration on May 20, including National Security Council (NSC) Secretary-General Wellington Koo (顧立雄) to be the new defense minister and former Taichung mayor Lin Chia-lung (林佳龍) as minister of foreign affairs. While Koo is to head the Ministry of National Defense and presidential aide Lin is to take over as minister of foreign affairs, Tsai Ming-yen (蔡明彥) would be retained as the nation’s intelligence chief, continuing to serve as director-general of the National Security Bureau, Lai told a news conference in Taipei. Koo,
MANAGING DIFFERENCES: In a meeting days after the US president signed a massive foreign aid bill, Antony Blinken raised concerns with the Chinese president about Taiwan US Secretary of State Antony Blinken yesterday met with Chinese President Xi Jinping (習近平) and senior Chinese officials, stressing the importance of “responsibly managing” the differences between the US and China as the two sides butt heads over a number of contentious bilateral, regional and global issues, including Taiwan and the South China Sea. Talks between the two sides have increased over the past few months, even as differences have grown. Blinken said he raised concerns with Xi about Taiwan and the South China Sea, along with China’s support for Russia and its invasion of Ukraine, as well as other issues