US stock markets climbed steadily, if unspectacularly, this week, nearing three-year highs despite worry over rising oil prices and Europe’s slow boil debt crisis.
“Stocks were in a bear market from October 2007 until March 2009,” said Beth Ann Bovino of Standard & Poor’s (S&P). “They have now recovered much of those losses.”
The holiday-shortened week saw the Dow Jones Industrial Average hover above the symbolic threshold of 13,000 points, helping add to confidence about the growing economy and falling unemployment.
At the end of the week, the Dow was up 0.3 percent at 12,982.95 points. The NASDAQ rose 0.4 percent and the S&P 500 rose 0.3 percent.
“A stronger job market is helping the US weather headwinds from both home and abroad,” said economists at Nomura, a Japanese bank.
One of those headwinds is higher oil prices, which have been rising on tensions in Iran.
While prices have been on the rise for some time, there was renewed focus this week as US politicians talked extensively about what can be done to stem the rise in this election year.
“Oil prices are on the rise again and concerns are growing about their impact on the recovery,” IHS Global Insight economists Paul Edelstein said.
“The situation is reminiscent of early-2011, when Brent oil prices reached US$126 a barrel, creating a growth pocket in the middle of the year,” he said.
“If oil prices stay persistently high or continue to rise, growth forecasts will likely be revised downward, but it would take a much bigger spike in prices to sink the US economy back into recession,” he said.
Higher oil prices spelled a boon for the oil majors. ExxonMobil was up 2 percent for the week, and Chevron was up 2.3 percent
Airlines got the raw end of that trade. US Airways plunged 21 percent, United Continental 13 percent and Delta 12 percent for the week.
In other sectors Wal-Mart saw steep declines, down 5.9 percent following disappointing quarterly earnings. Hewlett-Packard suffered a nearly 10 percent drop after reporting a 44 percent profit fall in its fiscal first quarter.
Real estate agent and property developer JSL Construction & Development Co (愛山林) led the average compensation rankings among companies listed on the Taiwan Stock Exchange (TWSE) last year, while contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) finished 14th. JSL Construction paid its employees total average compensation of NT$4.78 million (US$159,701), down 13.5 percent from a year earlier, but still ahead of the most profitable listed tech giants, including TSMC, TWSE data showed. Last year, the average compensation (which includes salary, overtime, bonuses and allowances) paid by TSMC rose 21.6 percent to reach about NT$3.33 million, lifting its ranking by 10 notches
SEASONAL WEAKNESS: The combined revenue of the top 10 foundries fell 5.4%, but rush orders and China’s subsidies partially offset slowing demand Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) further solidified its dominance in the global wafer foundry business in the first quarter of this year, remaining far ahead of its closest rival, Samsung Electronics Co, TrendForce Corp (集邦科技) said yesterday. TSMC posted US$25.52 billion in sales in the January-to-March period, down 5 percent from the previous quarter, but its market share rose from 67.1 percent the previous quarter to 67.6 percent, TrendForce said in a report. While smartphone-related wafer shipments declined in the first quarter due to seasonal factors, solid demand for artificial intelligence (AI) and high-performance computing (HPC) devices and urgent TV-related orders
Prices of gasoline and diesel products at domestic fuel stations are this week to rise NT$0.2 and NT$0.3 per liter respectively, after international crude oil prices increased last week, CPC Corp, Taiwan (台灣中油) and Formosa Petrochemical Corp (台塑石化) said yesterday. International crude oil prices last week snapped a two-week losing streak as the geopolitical situation between Russia and Ukraine turned increasingly tense, CPC said in a statement. News that some oil production facilities in Alberta, Canada, were shut down due to wildfires and that US-Iran nuclear talks made no progress also helped push oil prices to a significant weekly gain, Formosa said
MINERAL DIPLOMACY: The Chinese commerce ministry said it approved applications for the export of rare earths in a move that could help ease US-China trade tensions Chinese Vice Premier He Lifeng (何立峰) is today to meet a US delegation for talks in the UK, Beijing announced on Saturday amid a fragile truce in the trade dispute between the two powers. He is to visit the UK from yesterday to Friday at the invitation of the British government, the Chinese Ministry of Foreign Affairs said in a statement. He and US representatives are to cochair the first meeting of the US-China economic and trade consultation mechanism, it said. US President Donald Trump on Friday announced that a new round of trade talks with China would start in London beginning today,
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