European stocks posted their biggest weekly gain this year, sending the STOXX Europe 600 Index to its highest level in six months, as manufacturing increased globally and the US jobless rate fell to the lowest in three years.
Xstrata PLC and Glencore International PLC surged more than 13 percent after the world’s largest publicly traded commodities trader held talks to buy the Zug, Switzerland-based mining company. Temenos Group AG rallied 20 percent as Misys PLC, the British maker of software for banks, said it has held talks about a merger with the Swiss company.
The STOXX 600 climbed 3.6 percent to 264.6 this week, extending last month’s rally of 4 percent that was the best start to a year since 1998. The equity gauge has gained 8.2 percent this year and is up 23 percent since its two-and-a-half-year low on Sept. 22.
“We had a very good week,” Veronika Pechlaner, who helps manage £1.1 billion (US$1.7 billion) at Jersey, Channel Islands-based Ashburton Ltd, said in a telephone interview. The US employment numbers “are providing more hope to the market that the recovery in the US is not only on track, but maybe accelerating a little bit.”
The STOXX 600 surged 2 percent on Wednesday, the most in six weeks, as gauges of manufacturing increased from the US to China.
The Markit Economics final purchasing managers’ index, a gauge of manufacturing in the eurozone, climbed to 48.8 last month from 46.9 in the prior month. A UK manufacturing index also jumped to an eight-month high.
The European stocks gauge rallied 1.7 percent on Friday after US Labor Department figures showed employment climbed more than forecast, with a 243,000 increase in payrolls.
All 19 industry groups in the STOXX 600 gained more than 1.2 percent.
Three experts in the high technology industry have said that US President Donald Trump’s pledge to impose higher tariffs on Taiwanese semiconductors is part of an effort to force Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) to the negotiating table. In a speech to Republicans on Jan. 27, Trump said he intends to impose tariffs on Taiwan to bring chip production to the US. “The incentive is going to be they’re not going to want to pay a 25, 50 or even a 100 percent tax,” he said. Darson Chiu (邱達生), an economics professor at Taichung-based Tunghai University and director-general of
Hon Hai Precision Industry Co (鴻海精密) is reportedly making another pass at Nissan Motor Co, as the Japanese automaker's tie-up with Honda Motor Co falls apart. Nissan shares rose as much as 6 percent after Taiwan’s Central News Agency reported that Hon Hai chairman Young Liu (劉揚偉) instructed former Nissan executive Jun Seki to connect with French carmaker Renault SA, which holds about 36 percent of Nissan’s stock. Hon Hai, the Taiwanese iPhone-maker also known as Foxconn Technology Group (富士康科技集團), was exploring an investment or buyout of Nissan last year, but backed off in December after the Japanese carmaker penned a deal
‘LEGACY CHIPS’: Chinese companies have dramatically increased mature chip production capacity, but the West’s drive for secure supply chains offers a lifeline for Taiwan When Powerchip Technology Corp (力晶科技) entered a deal with the eastern Chinese city of Hefei in 2015 to set up a new chip foundry, it hoped the move would help provide better access to the promising Chinese market. However, nine years later, that Chinese foundry, Nexchip Semiconductor Corp (合晶集成), has become one of its biggest rivals in the legacy chip space, leveraging steep discounts after Beijing’s localization call forced Powerchip to give up the once-lucrative business making integrated circuits for Chinese flat panels. Nexchip is among Chinese foundries quickly winning market share in the crucial US$56.3 billion industry of so-called legacy
WASHINGTON POLICY: Tariffs of 10 percent or more and other new costs are tipped to hit shipments of small parcels, cutting export growth by 1.3 percentage points The decision by US President Donald Trump to ban Chinese companies from using a US tariff loophole would hit tens of billions of dollars of trade and reduce China’s economic growth this year, according to new estimates by economists at Nomura Holdings Inc. According to Nomura’s estimates, last year companies such as Shein (希音) and PDD Holdings Inc’s (拼多多控股) Temu shipped US$46 billion of small parcels to the US to take advantage of the rule that allows items with a declared value under US$800 to enter the US tariff-free. Tariffs of 10 percent or more and other new costs would slash such