The major US stock indexes ended slightly higher on the week on Friday, with the Dow Jones Industrials managing to stay above 12,000 points despite a report showing a surprise slowdown in US economic growth.
In the week to Friday, the Dow Jones Industrial Average of 30 blue-chip stocks climbed 0.73 percent to end at 12,090.26.
The Dow had tumbled in Friday trading, but managed to remain above 12,000 points, a barrier it smashed through for the first time ever last week.
The technology-weighted NASDAQ composite meanwhile rose 0.35 percent to 2,350.62, while the broad-market Standard & Poor's 500 increased 0.64 percent on the week to 1,377.34.
Stocks remained generally buoyant during the week on robust third-quarter corporate earnings reports, particularly from the oil sector as industry giant ExxonMobil Corp, posted record third-quarter net profits of US$10.49 billion.
Earnings from software maker Microsoft and AT&T also came in ahead of Wall Street forecasts, although profits from Boeing and Altria did not meet market hopes.
Third-quarter corporate earnings, however, in general continue to be robust, but the economic news is getting murkier.
The government said on Friday that US growth on an annualized basis slowed abruptly to 1.6 percent, against forecasts of 2.1 percent, and compared to second-quarter growth of 2.6 percent.
The report showed US growth posted its worst performance since the first quarter of 2003, due above all to the end of a long boom in the US property market.
"What really matters now is not third-quarter GDP, is not third-quarter earnings. What matters now is fourth-quarter and 2007," said Hugh Johnson, an analyst with Johnson Illington Advisors.
"The message of the market is: It will be a soft landing, but if it is a soft landing it will be a close call," he said of the economy's direction.
Some economists agreed with this outlook.
"While weak growth fanned fears of a potential stall in the economy at the end of last week, indicators this week should, on balance, support the soft-landing scenario," Global Insight US economists Nigel Gault and Brian Bethune said.
Analysts said the key report in the coming week would be Friday's release on this month's non-farm payrolls, and its revealing snapshot on the health of the job market.
Market forecasts call for non-farm payrolls to rise by 125,000 positions this month, compared with lackluster hiring of 51,000 in the prior month.
The coming week will also see releases on personal spending, construction spending, consumer confidence and auto sales.
Total auto industry sales for this month are forecast to remain steady at around 5.3 million units compared with August.
Bond prices strengthened in the past week. The yield on the 10-year Treasury bond fell to 4.675 percent from 4.784 percent a week earlier, while that on the 30-year bond declined a to 4.796 percent from 4.904 percent.
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
ISSUES: Gogoro has been struggling with ballooning losses and was recently embroiled in alleged subsidy fraud, using Chinese-made components instead of locally made parts Gogoro Inc (睿能創意), the nation’s biggest electric scooter maker, yesterday said that its chairman and CEO Horace Luke (陸學森) has resigned amid chronic losses and probes into the company’s alleged involvement in subsidy fraud. The board of directors nominated Reuntex Group (潤泰集團) general counsel Tamon Tseng (曾夢達) as the company’s new chairman, Gogoro said in a statement. Ruentex is Gogoro’s biggest stakeholder. Gogoro Taiwan general manager Henry Chiang (姜家煒) is to serve as acting CEO during the interim period, the statement said. Luke’s departure came as a bombshell yesterday. As a company founder, he has played a key role in pushing for the
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
RSS