European stocks plunged the most since the nadir of the February slump, as investors shunned risky assets before monetary-policy and political events later this month.
The STOXX Europe 600 Index lost 2.4 percent at the close of trading on Friday, deepening its worst weekly drop in a month to 2.5 percent. All but 16 stocks fell, with lenders in Italy and Greece among the worst performers. A gauge of eurozone stock volatility jumped 17 percent, extending its biggest weekly gain since January.
Investors are bracing for a slew of potential triggers in the next two weeks, amid signals that European Central Bank officials might sit tight on stimulus measures over the summer months.
The US Federal Reserve’s rate decision and the Bank of Japan’s policy statement are both due on Wednesday, followed by a June 23 referendum to determine Britain’s membership in the EU and Spain’s general election three days after that.
“Everybody seems angry about this market,” said Benno Galliker, a trader at Luzerner Kantonalbank AG in Lucerne, Switzerland. “It really looked like we could go to the upside, but now in Europe it seems everything is falling apart. Nobody wants to stay in the market with so many things coming up: the Fed, BOJ, Brexit vote.”
The STOXX 600 kicked off this week with gains amid a rally in oil shares and optimism the Fed would not raise rates prematurely, only to reverse direction mid-week as political uncertainty and concern over global growth took hold. The benchmark has struggled to maintain momentum in a rebound after surging 16 percent from its February low to an April 20 high. It has traded in a range of less than 25 points since March.
Among other shares active on corporate news, Deutsche Lufthansa AG dropped 5.6 percent after announcing the surprise departure of the firm’s chief financial officer Simone Menne. PSA Peugeot Citroen fell 1.6 percent after a report that 10 members of the Peugeot family might consider boosting their holding in the company.
London-based staffing company SThree PLC tumbled 8.4 percent after saying uncertainty stemming from Britain’s EU referendum has led to a slowdown in its UK business. Recruitment providers Hays PLC and PageGroup PLC slid more than 6 percent.
BULK PURCHASE: The French chain and Hong Kong-based Dairy Farm International reached a deal covering 224 stores, which is expected to be finalized by year’s end Carrefour SA yesterday announced it would acquire Wellcome Taiwan Co (惠康百貨) for 97 million euros (US$108.33 million), and bring all the Wellcome supermarkets (頂好超市) and Jasons Market Place stores nationwide under its banner within 12 months of the deal closing. The France-based hypermarket chain reached an agreement with Hong Kong-based Dairy Farm International Holdings (牛奶國際控股), the pan-Asian retailer that launched Wellcome Taiwan in 1987. The transaction involves 199 Wellcome supermarkets, which have average sales areas of 420m2 and 25 high-end Jasons Market Place stores, which have an average sales area of 820m2, as well as a warehouse in Taoyuan, Carrefour Taiwan (家樂福)
‘ONE-STOP SHOP’: A Miaoli official said that the factory in the Jhunan section of the Hsinchu Science Park would create more than 1,000 jobs and boost prosperity A new high-end IC packaging and testing plant planned by contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) in Miaoli County is expected to start operations in the middle of next year, Miaoli County Commissioner Hsu Yao-chang (徐耀昌) said. Hsu wrote on Facebook that TSMC, the world’s largest pure wafer foundry operator, would invest NT$303.2 billion (US$10.1 billion) to build the plant, the largest-ever single investment in Taiwan. However, TSMC declined to disclose the financial terms of the deal, while a company board meeting on May 12 approved a spending plan worth NT$168.2 billion as part of its investment plans. Construction of the
SCATTERED: Production would be dispersed among a number of countries, which would bring an end to so-called world factories, Hon Hai chairman Young Liu said Decentralized production would be the new focus in manufacturing, Hon Hai Precision Industry Co (鴻海精密) chairman Young Liu (劉揚偉) yesterday told an online forum held by the Market Intelligence & Consulting Institute (MIC, 產業情報研究所). “The COVID-19 pandemic exerted a heavy impact on supply chains as well as production ... [production] would no longer be concentrated in solely one country, this is the end of what we used to call world factories,” Liu said during a panel discussion hosted by MIC director Victor Tsan (詹文男). As the US and China continue to dominate and sway international relations, the rest of the world is
PLANNED OUT: The government is lifting sale and export restrictions on 60% of the 20 million masks made daily, but people can still make purchases using their NHI cards Twenty thousand boxes of 50 masks each would be on sale at FamilyMart convenience stores starting tomorrow, Taiwan FamilyMart Co Ltd (全家便利商店) said yesterday. A box of 50 masks would cost NT$249 for those with FamilyMart memberships and NT$299 for those without, with no limits placed on how many boxes a person can buy, the company said. Convenience store chain operator Hi-Life International Co Ltd (萊爾富) said that it would also start selling masks from tomorrow. It has yet to announce details about prices and quantity. Hypermarket chain operator Carrefour Taiwan (家樂福) said that it would start selling packs of five