European stocks fell for a second week, for the biggest loss since June, amid concern any military action by the US against Syria may escalate into a larger conflict in the Middle East and push up oil prices.
The STOXX Europe 600 Index declined 2.4 percent to 297.32 this week, ending last month with only the second monthly loss since May last year.
The equity benchmark has still rallied 7.9 percent from this year’s low on June 24, as the European Central Bank and the Bank of England pledged to keep interest rates low.
“Syria was a key factor in driving markets lower this week as the threat of a military intervention and the threat of a spike in oil prices tend to be a bad combination for equity investors,” said Andreas Nigg, head of equity and commodity strategy at Vontobel Asset Management in Zurich. “We had a nice summer rally and we are entering the weakest seasonal period from an equity perspective.”
The VSTOXX Index, a gauge of expected volatility in euro-area stocks based on options prices, posted the second-biggest weekly increase since November 2011, jumping 32 percent.
National benchmark indices dropped in all of the 18 Western European markets. Germany’s DAX declined 3.7 percent. The UK’s FTSE 100 slipped 1.2 percent. France’s CAC 40 lost 3.3 percent.
The US Federal Reserve will hold a policy meeting on Sept. 17 and 18 to decide whether to slow the pace of its bond-purchase program. Fed Chairman Ben Bernanke said in May and June that the central bank may consider tapering if the employment outlook improved substantially and the economy grows as forecast.
The issue of the US’ statutory debt ceiling resurfaced with the US Treasury Department saying the nation would exhaust its borrowing limit of US$16.699 trillion in the middle of next month. Congressional Republicans and US President Barack Obama’s administration are gearing up for battles starting early this month over federal spending and borrowing.
ThromboGenics NV plunged 25 percent after its sales forecast missed analysts’ estimates. Serco Group PLC tumbled 12 percent as some of its staff members came under investigation for suspected fraudulent behavior. Vodafone Group PLC jumped 7.6 percent after confirming talks with Verizon Communications Inc to sell its 45 percent stake in Verizon Wireless.
FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said. The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private. Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said. The South Korean company has about 147,000 in staff overseas, more than half
Taipei is today suspending its US$2.5 trillion stock market as Super Typhoon Krathon approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed-income trading, statements from its stock and currency exchanges said. Yesterday, schools and offices were closed in several cities and counties in southern and eastern Taiwan, including in the key industrial port city of Kaohsiung. Taiwan, which started canceling flights, ship sailings and some train services earlier this week, has wind and rain advisories in place for much of the island. It regularly experiences typhoons, and in July shut offices and schools as
TECH PARTNERSHIP: The deal with Arizona-based Amkor would provide TSMC with advanced packing and test capacities, a requirement to serve US customers Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is collaborating with Amkor Technology Inc to provide local advanced packaging and test capacities in Arizona to address customer requirements for geographical flexibility in chip manufacturing. As part of the agreement, TSMC, the world’s biggest contract chipmaker, would contract turnkey advanced packaging and test services from Amkor at their planned facility in Peoria, Arizona, a joint statement released yesterday said. TSMC would leverage these services to support its customers, particularly those using TSMC’s advanced wafer fabrication facilities in Phoenix, Arizona, it said. The companies would jointly define the specific packaging technologies, such as TSMC’s Integrated
An Indian factory producing iPhone components resumed work yesterday after a fire that halted production — the third blaze to disrupt Apple Inc’s local supply chain since the start of last year. Local industrial behemoth Tata Group’s plant in Tamil Nadu, which was shut down by the unexplained fire on Saturday, is a key linchpin of Apple’s nascent supply chain in the country. A spokesperson for subsidiary Tata Electronics Pvt yesterday said that the company would restart work in “many areas of the facility today.” “We’ve been working diligently since Saturday to support our team and to identify the cause of the fire,”
RSS