European stocks posted their biggest weekly decline this year, as economic data from China to the US and Europe raised concerns the global economic recovery was faltering.
The STOXX Europe 600 Index lost 2.5 percent to 265.65 this week, its biggest decline since December. The benchmark measure has still rallied 8.6 percent this year, as the European Central bank provided loans of 1 trillion euros (US$1.3 trillion) to the region’s banks and US economic data surpassed estimates.
“Markets are getting too optimistic,” Gerard Lyons, chief economist at Standard Chartered PLC in London, said in an interview on Bloomberg Television. “Overall, the eurozone is in a double-dip recession. The Chinese economy is cooling. The US is not having a double-dip, but it’s not having a strong recovery.”
The mean daily volume of shares changing hands on the STOXX 600 this week was 12 percent lower than the average in the last 12 months, according to data compiled by Bloomberg.
European services and manufacturing output contracted more than forecast. A euro-area composite index based on a survey of purchasing managers in both industries dropped to 48.7 from 49.3 last month, Markit Economics said on Thursday.
All but one of the 19 industry groups in the STOXX 600 retreated this week, led by a gauge of mining companies that lost 7.2 percent. An index of telecommunications companies gained 2 percent.
National benchmark indexes declined in 15 of the 18 western European markets. France’s CAC 40 Index lost 3.3 percent. Germany’s DAX decreased 2.3 percent, and the UK’s FTSE 100 Index slid 1.9 percent.
In China, a preliminary measure of manufacturing fell to 48.1 this month, according to a report by HSBC Holdings PLC and Markit on Thursday. That’s the lowest reading on the purchase managers’ index since November. A result below 50 indicates a contraction.
In the US, purchases of new homes unexpectedly fell last month for a second month, a sign the recovery in the housing market might be uneven.
Sales dropped 1.6 percent to a 313,000 annual pace, the slowest since October, from a 318,000 rate in January that was weaker than previously reported, figures from the US Commerce Department showed on Friday in Washington.
Meanwhile, initial jobless claims fell to 348,000 in the week ended March 17, the fewest since February 2008, US Labor Department figures showed on Thursday. Economists in a Bloomberg survey had forecast a decline to 350,000.
US Federal Reserve Chairman Ben Bernanke said on Wednesday in a testimony to US lawmakers that Europe must further strengthen its banks and that its financial and economic situation “remains difficult” even as stresses have lessened.
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A proposed 100 percent tariff on chip imports announced by US President Donald Trump could shift more of Taiwan’s semiconductor production overseas, a Taiwan Institute of Economic Research (TIER) researcher said yesterday. Trump’s tariff policy will accelerate the global semiconductor industry’s pace to establish roots in the US, leading to higher supply chain costs and ultimately raising prices of consumer electronics and creating uncertainty for future market demand, Arisa Liu (劉佩真) at the institute’s Taiwan Industry Economics Database said in a telephone interview. Trump’s move signals his intention to "restore the glory of the US semiconductor industry," Liu noted, saying that
NEGOTIATIONS: Semiconductors play an outsized role in Taiwan’s industrial and economic development and are a major driver of the Taiwan-US trade imbalance With US President Donald Trump threatening to impose tariffs on semiconductors, Taiwan is expected to face a significant challenge, as information and communications technology (ICT) products account for more than 70 percent of its exports to the US, Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) president Lien Hsien-ming (連賢明) said on Friday. Compared with other countries, semiconductors play a disproportionately large role in Taiwan’s industrial and economic development, Lien said. As the sixth-largest contributor to the US trade deficit, Taiwan recorded a US$73.9 billion trade surplus with the US last year — up from US$47.8 billion in 2023 — driven by strong
STILL UNCLEAR: Several aspects of the policy still need to be clarified, such as whether the exemptions would expand to related products, PwC Taiwan warned The TAIEX surged yesterday, led by gains in Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), after US President Donald Trump announced a sweeping 100 percent tariff on imported semiconductors — while exempting companies operating or building plants in the US, which includes TSMC. The benchmark index jumped 556.41 points, or 2.37 percent, to close at 24,003.77, breaching the 24,000-point level and hitting its highest close this year, Taiwan Stock Exchange (TWSE) data showed. TSMC rose NT$55, or 4.89 percent, to close at a record NT$1,180, as the company is already investing heavily in a multibillion-dollar plant in Arizona that led investors to assume
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