European stocks advanced this week, pushing the Dow Jones STOXX 600 Index to its biggest gain since July, as investors speculated mergers will increase and evidence mounted that the economy is recovering from recession.
Cadbury PLC, the world’s largest confectioner, jumped 37 percent after rejecting a US$16 billion takeover offer from Kraft Foods Inc. BHP Billiton Ltd climbed 8.1 percent as metal prices rose and reports showed industrial production and investment growth in China accelerated. Renault SA surged 10 percent as chief executive officer Carlos Ghosn said the worst of the financial crisis was over.
The STOXX 600 added 3.4 percent to 241.74 this past week, extending an 11-month high. The measure has soared 53 percent since March 9 as companies from Goldman Sachs Group Inc to L’Oreal SA reported better-than-estimated results and the German and French economies unexpectedly grew. The rally has driven the STOXX 600’s valuation to 46.7 times reported company earnings, the highest level since 2003, according to Bloomberg data.
“The upward trend is still intact,” said Daniel Knuchel, who oversees about US$3 billion as chief investment officer at AAM Privatbank AG in Zurich. “M&A activity is a positive factor as it shows that companies are seeing value again. It spurs a certain confidence if you see large transactions like Kraft’s bid for Cadbury.”
European investor confidence increased for a second month in September as the euro-area economy starts to recover, according to data from the Limburg, Germany-based Sentix research institute.
National benchmark indexes increased in all 18 western European markets, except Iceland. The UK’s FTSE 100 advanced 3.3 percent and France’s CAC 40 rose 3.8 percent. Germany’s DAX climbed 4.5 percent as Commerzbank AG rallied.
The VSTOXX Index, which gauges the cost of insurance against declines on the Euro STOXX 50, fell 8.5 percent to the lowest level in a year.
STMicroelectronics NV, Europe’s biggest semiconductor maker, rose 6.5 percent and Infineon Technologies AG, the second-largest, climbed 7.2 percent after Texas Instruments Inc, the second-biggest US chipmaker, increased its sales and earnings forecasts and said demand for so-called analog chips is beginning to recover.
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
FAST RELEASE: The council lauded the developer for completing model testing in only four days and releasing a commercial version for use by academia and industry The National Science and Technology Council (NSTC) yesterday released the latest artificial intelligence (AI) language model in traditional Chinese embedded with Taiwanese cultural values. The council launched the Trustworthy AI Dialogue Engine (TAIDE) program in April last year to develop and train traditional Chinese-language models based on LLaMA, the open-source AI language model released by Meta. The program aims to tackle the information bias that is often present in international large-scale language models and take Taiwanese culture and values into consideration, it said. Llama 3-TAIDE-LX-8B-Chat-Alpha1, released yesterday, is the latest large language model in traditional Chinese. It was trained based on Meta’s Llama-3-8B
STUMPED: KMT and TPP lawmakers approved a resolution to suspend the rate hike, which the government said was unavoidable in view of rising global energy costs The Ministry of Economic Affairs yesterday said it has a mandate to raise electricity prices as planned after the legislature passed a non-binding resolution along partisan lines to freeze rates. Chinese Nationalist Party (KMT) lawmakers proposed the resolution to suspend the price hike, which passed by a 59-50 vote. The Taiwan People’s Party (TPP) voted with the KMT. Legislative Speaker Han Kuo-yu (韓國瑜) of the KMT said the resolution is a mandate for the “immediate suspension of electricity price hikes” and for the Executive Yuan to review its energy policy and propose supplementary measures. A government-organized electricity price evaluation board in March
NOVEL METHODS: The PLA has adopted new approaches and recently conducted three combat readiness drills at night which included aircraft and ships, an official said Taiwan is monitoring China’s People’s Liberation Army (PLA) exercises for changes in their size or pattern as the nation prepares for president-elect William Lai’s (賴清德) inauguration on May 20, National Security Bureau (NSB) Director-General Tsai Ming-yen (蔡明彥) said yesterday. Tsai made the comment at a meeting of the Legislative Yuan’s Foreign Affairs and National Defense Committee, in response to Democratic Progressive Party (DPP) Legislator Wang Ting-yu’s (王定宇) questions. China continues to employ a carrot-and-stick approach, in which it applies pressure with “gray zone” tactics, while attempting to entice Taiwanese with perks, Tsai said. These actions aim to help Beijing look like it has