European equities fell, posting their worst weekly decline since mid-June, on mounting concern that the rise in COVID-19 cases would hamper the region’s economic recovery. Banks slid to a record low.
The STOXX Europe 600 on Friday closed down 0.1 percent at 355.51, and is down 3.6 percent this week as countries including the UK and France tighten their virus rules, and former hotspots such as the Spanish capital of Madrid report rising hospitalizations.
The STOXX 600 Banks Index declined for a seventh straight day, closing at the lowest level since its creation in 1991, hit by concerns over coronavirus-related lockdowns, low interest rates and bad loans.
Democrats in the US House of Representatives have started drafting a stimulus proposal of roughly US$2.4 trillion, just as economists were expressing doubts over whether additional funding would be seen this year.
“We think it makes sense to stay positioned for continued recovery and further cyclical outperformance, but the argument has become more balanced,” Bank of America Corp strategists led by Sebastian Raedler wrote in a note on Friday.
“The downside risks have increased,” they said.
UBS Global Wealth Management’s chief investment officer Mark Haefele said that “overall, we maintain our constructive outlook for equities over the coming months, while acknowledging that markets will likely be choppy.”
Meanwhile in London, a nearly 44 percent surge in bookmaker William Hill PLC on takeover offers lifted consumer stocks, helping UK shares outperform European peers and end a tumultuous week on a high note.
Without disclosing the value, buyout firm Apollo Global Management Inc and US casino operator Caesars Entertainment Inc made offers for the British betting firm, shares of which rose 43.47 percent on Friday to ￡312.20.
“William Hill had been one of the big gainers since March among UK equities... The news of course has done what bid approaches always do, namely lift the rest of the sector as well,” IG Group PLC chief market analyst Chris Beauchamp said.
London’s mid-caps index end up 1.4 percent in its best day in three weeks.
The blue-chip FTSE 100 index rose 0.34 percent, but losses for miners and oil stocks, which tracked commodity prices lower, and banks, which extended losses to a fourth straight session, kept gains in check.
It was down 2.74 percent from a week earlier.
HSBC Bank (Taiwan) Ltd (匯豐台灣商銀) has approved two sustainability-linked loans totaling NT$450 million (US$15.55 million) for Taya Group (大亞集團) and Sinbon Electronics Co (信邦電子), the bank said yesterday, adding that interest rates would fall if the borrowers’ sustainability performance improves. Those marked the first sustainability-linked loans granted by HSBC Taiwan, it said. While HSBC Taiwan has experience providing green loans for the nation’s developers of renewable energy sources to support their projects, the bank began focusing on sustainability-linked loans to meet rising demand from companies in other sectors planning to undertake sustainability programs, it said. “As we reward our clients who reach their
‘NEW TRAVEL MARKET’: The carrier initially planned to lay off about 8,000 people globally, but after government intervention reduced that to 18 percent of its workforce Cathay Pacific Airways Ltd (國泰航空) would cut 6,000 jobs and close its Cathay Dragon brand, the South China Morning Post reported, as part of a strategic review to combat the unprecedented damage caused by the COVID-19 pandemic. The Hong Kong-based airline is expected to officially announce the plan after the market close today, the newspaper said. It initially planned about 8,000 layoffs globally, but after government intervention reduced that to 18 percent of its total workforce, including about 5,000 jobs in Hong Kong, it said. The company, which posted a HK$9.9 billion (US$1.3 billion) loss in the first half, has for months
V-SHAPED RECOVERY: Local tech firms have benefited from strong demand for 5G deployment and electronic devices required for a low-contact economy, CIER said The Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) yesterday raised its forecast for the nation’s GDP growth this year to 1.76 percent, from its previous estimate of 1.33 percent, saying exports and private consumption have staged a V-shaped recovery from the COVID-19 pandemic in the second half of the year. “The upgrade aims to reflect the fast recovery in Taiwan’s exports and domestic demand,” CIER president Chang Chuang-chang (張傳章) told a media briefing. The Taipei-based think tank said the economy might have expanded 2.77 percent last quarter — emerging from a 0.78 percent decline in the second quarter — and would grow
Hon Hai Precision Industry Co (鴻海精密) founder Terry Gou (郭台銘) yesterday said that the company remains committed to its project in Wisconsin, but appeared to condition its completion on the receipt of state incentives, the Wall Street Journal reported. Gou said in a statement that Hon Hai, known as Foxconn Technology Group (富士康科技集團) outside of Taiwan, remains committed to its investment, although “market conditions and the COVID-19 pandemic” have altered the timing of its expansion and the specifics of its manufacturing plans. The company has over the past three years invested US$750 million to transform southeastern Wisconsin into a high-tech