European stocks posted a second week of losses as a standoff between US lawmakers led to the first government shutdown in 17 years for the world’s biggest economy.
Unilever led food and beverage stocks lower, falling 3.7 percent, after posting a slowdown in quarterly sales growth. Nokian Renkaat Oyj tumbled the most in almost a year after cutting its earnings forecast.
Mediobanca SpA and Banca Popolare di Milano Scarl led a rally in Italian banks as Italian Prime Minister Enrico Letta won a confidence vote.
The STOXX Europe 600 Index fell 0.7 percent to 309.89 this week, after declining 0.6 percent in the previous five days. The gauge is still up 11 percent this year, as the EU emerged from a recession and central banks maintained stimulus measures to support the global economy.
“The US shutdown is a comment on the dysfunctional ways of US politics,” Andrew Parry, at Hermes Sourcecap Ltd in London, said in a telephone interview.
“We came out of the summer months too optimistic about Europe, so some pause for breath was needed. We saw the profit warning from Nokian Renkaat and the numbers from Unilever. I think we’ll continue to get more profit warnings going into the earnings season,” Parry said.
The US government began a partial shutdown on Tuesday after Democrats and Republicans failed to agree on a budget, closing some services and placing as many as 800,000 federal employees on unpaid leave.
A two-week halt could shave 0.25 percentage point off fourth-quarter economic growth, US Federal Reserve Bank of San Francisco President John Williams forecast.
National benchmark indices fell in 11 of the 18 Western European markets this week. Germany’s DAX retreated 0.4 percent, while the UK’s FTSE 100 lost 0.9 percent. France’s CAC 40 decreased 0.5 percent.
Italy’s FTSE MIB surged 3.7 percent, the most since July. Letta won a confidence vote on Wednesday, with support from former Italian prime minister Silvio Berlusconi, who reversed his position after initially trying to bring down the five-month-old government by withdrawing his ministers from the coalition.
Popolare di Milano surged 16 percent and Mediobanca gained 12 percent in Milan trading. UniCredit SpA, Italy’s largest lender, advanced 9.6 percent.
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
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Taiwanese manufacturers have a chance to play a key role in the humanoid robot supply chain, Tongtai Machine and Tool Co (東台精機) chairman Yen Jui-hsiung (嚴瑞雄) said yesterday. That is because Taiwanese companies are capable of making key parts needed for humanoid robots to move, such as harmonic drives and planetary gearboxes, Yen said. This ability to produce these key elements could help Taiwanese manufacturers “become part of the US supply chain,” he added. Yen made the remarks a day after Nvidia Corp cofounder and chief executive officer Jensen Huang (黃仁勳) said his company and Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) are jointly
United Microelectronics Corp (UMC, 聯電) expects its addressable market to grow by a low single-digit percentage this year, lower than the overall foundry industry’s 15 percent expansion and the global semiconductor industry’s 10 percent growth, the contract chipmaker said yesterday after reporting the worst profit in four-and-a-half years in the fourth quarter of last year. Growth would be fueled by demand for artificial intelligence (AI) servers, a moderate recovery in consumer electronics and an increase in semiconductor content, UMC said. “UMC’s goal is to outgrow our addressable market while maintaining our structural profitability,” UMC copresident Jason Wang (王石) told an online earnings
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