The euro rebounded from an 11-year low as investors assessed the election victory in Greece of the anti-austerity Syriza party. European stocks erased earlier losses, while Russia’s ruble weakened.
The 19-nation euro strengthened 0.4 percent to US$1.1252 by 9:49am in London. The Stoxx Europe 600 Index, which closed at a seven-year high on Friday last week, advanced 0.2 percent, while Standard & Poor’s 500 Index futures dropped 0.4 percent. Greece’s bonds fell.
The ruble tumbled 2.2 percent as fighting in Ukraine spread.
Photo: Reuters
Greek prime minister-elect Alexis Tsipras prepared to form a government after coming within two seats of an absolute majority with most votes counted.
“Syriza’s win won’t be as bad for markets now as it could have been a few months ago,” said Alessandro Bee, a strategist at Bank J Safra Sarasin AG in Zurich. “Tsipras is less aggressive and willing to negotiate. The result will affect sentiment on Greece, but in a broader European context it’s just a blip. Markets are still in a risk-on mode and any news is dwarfed by the ECB stimulus program.”
Tsipras, 40, has pledged to keep the nation within the single currency area as he negotiates a writedown of Greek debt and eases budget constraints that were imposed in return for aid after the country’s economic collapse.
The current round of funding expires on Feb. 28 and talks with the so-called troika — the IMF, the European Commission and the ECB — for its renewal have stalled since September last year amid demands for further belt tightening.
Germany’s Ministry of Finance said in a statement that Minister of Finance Wolfgang Schaeuble’s position was unchanged after the election result and “the agreements reached with Greece remain valid.”
Finance ministers from the euro area were due to discuss Greece and its bailout in Brussels later yesterday.
The euro retreated 7.4 percent versus the dollar this year through Friday last week, the biggest decline among 16 major currencies tracked by Bloomberg.
The euro’s slide is putting pressure on China’s yuan, which yesterday rose through 7 per euro for the first time since 2001.
The yuan’s two-day drop of as much as 0.8 percent pushed it to a record 1.89 percent discount to the central bank’s reference rate. It sank as low as 6.2569 per US dollar as the People’s Bank of China cut its daily fixing by 0.07 percent to 6.1384 a dollar, the lowest since Dec. 4 last year. The spot rate rate is allowed to diverge a maximum 2 percent from the fixing.
Russia’s currency slid to 65.7490 per dollar and 2.5 percent to 73.911 to the euro.
After several years flying high as Asia’s best Nvidia Corp proxy, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is increasingly vying with other artificial intelligence (AI) stocks for investor attention. Stock traders are chasing a wider array of beneficiaries as mainstream usage of AI creates demand for hardware beyond the most-advanced chips TSMC makes for Nvidia. Subthemes from the deepening memory crunch to advances in robotics are also luring bids. At the same time, investment caps on single stocks are pushing funds to diversify, while retail investors long familiar with TSMC through its US depositary receipts are being offered a broader set of
UNDER MICROSCOPE: Taiwan detained three people who allegedly conspired to buy servers in Taiwan and export them using fraudulent documentation, prosecutors said Nvidia Corp chief executive officer Jensen Huang (黃仁勳) on Saturday urged Super Micro Computer Inc to tighten up on compliance after Taiwan detained three people this week for allegedly making fraudulent declarations about artificial intelligence (AI) servers made by its US partner. The development marked the nation’s first crackdown on semiconductor smuggling, which grew after the US slapped restrictions on exports of high-end chips such as Nvidia AI accelerators to China. Nvidia is “rigorous” in explaining regulations to all of its partners, Huang told reporters after arriving in Taipei. “Ultimately Super Micro has to run their own company,” he said in response to
TECH RELIANCE: Growth is increasingly reflecting an unequal K-shaped distribution, where technology sectors outperform and other industries struggle, an expert said Standard Chartered Bank has significantly raised its forecast for Taiwan’s economic growth to 9.5 percent this year, up from 7.6 percent previously, citing surging artificial intelligence (AI) demand driving exports, semiconductor production and investment. The upgrade reflects a sustained AI supercycle that continues to fuel demand for advanced chips and technology infrastructure, which form the backbone of Taiwan’s exports, the bank said in a report this week. “We raise our 2026 growth forecast to reflect a much stronger-than-expected first-quarter GDP figure,” Standard Chartered senior economist for greater China and Asia Tommy Wu (胡東安) said in the report. Driven largely by a 35.3 percent
Two of Taiwan’s international carriers, Starlux Airlines Co (星宇航空) and EVA Airways Corp (長榮航空), have retained the five-star airline rating awarded by international airline review organization Skytrax. Starlux was awarded the distinction for a second consecutive year, while EVA Air received it for the 11th straight year, Skytrax said in statements released yesterday and on Thursday last week, respectively. The five-star rating is considered one of the airline industry's highest honors and is awarded following professional audits of airline product and frontline service standards, Skytrax said. The ratings are based on in-depth assessments using unified global quality standards rather than customer review scores
RSS