MANUFACTURING
Eurozone output slumps
Manufacturing in the eurozone shrank for a sixth month at the start of the third quarter, dragged down by Germany’s worst slump in seven years. The downbeat figures come in the wake of reports showing slower economic growth in France, Spain and the eurozone, with Italy stagnating. IHS Markit said its eurozone manufacturing purchasing managers’ index fell to 46.5 last month from 47.6 in June. In Germany, the factory gauge fell to 43.2 from 45 in June. A measure of export orders dropped to the lowest since 2009. The manufacturing weakness is apparent across the region, with output falling in Italy, France, Spain, Ireland and Austria.
STEEL
Top maker cuts forecast
ArcelorMittal, the world’s largest steelmaker, yesterday revised down its forecast for global steel demand, with a sharper reduction now envisaged in Europe due to a lean automotive market. The Luxembourg-based company said it expects global apparent steel consumption, which includes inventory changes, to rise between 0.5 and 1.5 percent this year, from a previous forecast of 1 to 1.5 percent. The company also reported a second-quarter core profit of US$1.56 billion, slightly above its compiled consensus of US$1.53 billion, but down from US$1.65 billion in the first quarter.
BANKING
Barclays earnings surge
Net income nearly quadrupled at Barclays PLC in the first half of the year on reduced litigation costs, helping compensate for difficult conditions in retail and investment banking. Net profit of ￡2.1 billion (US$2.5 billion) was a stellar improvement, but when heavy legal costs it suffered in the same period last year are stripped out, earnings slid 15 percent. Last year, the company was hit by a huge US$2 billion fine to resolve a US fraud case involving mortgage derivatives, as well as the costs of settling claims of mis-selling consumer credit insurance in the UK.
AUTOMAKERS
BMW profit dips on spending
Luxury automaker BMW AG yesterday said its net profit fell 29 percent to 1.48 billion euros (US$1.63 billion) in the second quarter from a year earlier as profits were reduced by higher spending on revamping factories and on new technologies such as battery-only cars and smartphone-based services. The company said vehicle sales rose 1.5 percent to 647,500, helped by its BMW Brilliance (華晨寶馬) joint venture in China, and revenue increased 2.9 percent to 25.7 billion euros. The automaker said that it was sticking with its profit forecast for the year.
CONGLOMERATES
Weak demand hits Siemens
Industrial equipment and technology company Siemens AG yesterday said its net profit slipped 6 percent in the past quarter, as weaker demand for factory automation from the auto and machine-building sectors hit earnings. Net profit eased to 1.134 billion euros in the April-June quarter, the company’s fiscal third, from the year-earlier period. Revenue rose 4 percent to 21.27 billion euros. The company’s order backlog hit a record high of 144 billion euros, led by sharp growth in its renewable energy business, which took in two orders for offshore wind farms in Taiwan totaling 2.3 billion euros, and by a 1.2 billion euro order for high-speed trains and maintenance in Russia.
China’s economic planning agency yesterday outlined details of measures aimed at boosting the economy, but refrained from major spending initiatives. The piecemeal nature of the plans announced yesterday appeared to disappoint investors who were hoping for bolder moves, and the Shanghai Composite Index gave up a 10 percent initial gain as markets reopened after a weeklong holiday to end 4.59 percent higher, while Hong Kong’s Hang Seng Index dived 9.41 percent. Chinese National Development and Reform Commission Chairman Zheng Shanjie (鄭珊潔) said the government would frontload 100 billion yuan (US$14.2 billion) in spending from the government’s budget for next year in addition
Advanced Micro Devices Inc (AMD) suffered its biggest stock decline in more than a month after the company unveiled new artificial intelligence (AI) chips, but did not provide hoped-for information on customers or financial performance. The stock slid 4 percent to US$164.18 on Thursday, the biggest single-day drop since Sept. 3. Shares of the company remain up 11 percent this year. AMD has emerged as the biggest contender to Nvidia Corp in the lucrative market of AI processors. The company’s latest chips would exceed some capabilities of its rival, AMD chief executive officer Lisa Su (蘇姿丰) said at an event hosted by
Sales RecORD: Hon Hai’s consolidated sales rose by about 20 percent last quarter, while Largan, another Apple supplier, saw quarterly sales increase by 17 percent IPhone assembler Hon Hai Precision Industry Co (鴻海精密) on Saturday reported its highest-ever quarterly sales for the third quarter on the back of solid global demand for artificial intelligence (AI) servers. Hon Hai, also known as Foxconn Technology Group (富士康科技集團) globally, said it posted NT$1.85 trillion (US$57.93 billion) in consolidated sales in the July-to-September quarter, up 19.46 percent from the previous quarter and up 20.15 percent from a year earlier. The figure beat the previous third-quarter high of NT$1.74 trillion recorded in 2022, company data showed. Due to rising demand for AI, Hon Hai said its cloud and networking division enjoyed strong sales
TECH JUGGERNAUT: TSMC shares have more than doubled since ChatGPT’s launch in late 2022, as demand for cutting-edge artificial intelligence chips remains high Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday posted a better-than-expected 39 percent rise in quarterly revenue, assuaging concerns that artificial intelligence (AI) hardware spending is beginning to taper off. The main chipmaker for Nvidia Corp and Apple Inc reported third-quarter sales of NT$759.69 billion (US$23.6 billion), compared with the average analyst projection of NT$748 billion. For last month alone, TSMC reported revenue jumped 39.6 percent year-on-year to NT$251.87 billion. Taiwan’s largest company is to disclose its full third-quarter earnings on Thursday next week and update its outlook. Hsinchu-based TSMC produces the cutting-edge chips needed to train AI. The company now makes more
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