European stocks on Friday fell from record highs as concerns about the fast-spreading Delta variant of SARS-CoV-2 and regulatory actions in China outweighed optimism around the quarterly earnings season and an economic recovery.
The pan-European STOXX 600 index fell 0.45 percent to 461.74, but rose for a sixth straight month last month, its longest winning streak since 2012-2013 when it rose for 12 months in a row. It posted a weekly increase of 0.05 percent.
“We’ve seen moves in both directions this week, but they’ve lacked any sort of conviction,” CMC Markets chief market analyst Michael Hewson said. “The overriding concern being whether the second half of the year will be able to match up to some of the decent numbers we’ve seen from various company updates this week.”
Travel and leisure stocks and miners were the top decliners.
Italy’s UniCredit SpA gained 2.8 percent after posting higher-than-expected net profit, and said late on Thursday that it had embarked on formal talks with the government over the possible acquisition of rival Monte dei Paschi di Siena. Monte dei Paschi added 3.4 percent.
EssilorLuxottica rose 3.4 percent as the Ray-Ban maker raised its full-year guidance after revenue doubled in the second quarter.
Overall, out of half the STOXX 600 companies that have reported so far, 67 percent have topped analysts’ profit estimates, Institutional Brokers’ Estimate System data from Refinitiv showed.
While that is below the 72 percent beat-rate in the first quarter, it still tops the 51 percent rate in a typical quarter.
“We have had exceptional expectations, yet the companies have managed to beat those expectations,” said Oliver Collin, fund manager of European equities at Invesco. “Interesting thing in Europe is those beats, quite different to the US, were rewarded in some sort of positive share price momentum.”
Collin said European equities’ slant toward cheaply valued cyclical sectors and improved recovery momentum in the second quarter played a part in prompting the recent positive market response.
The eurozone economy grew more than expected in the second quarter as the bloc rebounded from a recession caused by the COVID-19 pandemic, preliminary data showed.
In London, the blue-chip FTSE 100 lost 0.65 percent, closing at 7,032.3, with miners and travel stocks leading the decline. It posted a weekly gain of 0.07 percent.
“I think what really drives the sentiment down is risk aversion, which [is] firmly in place due to several key earnings reports. Also bearish sentiment stemming from the China sell-off kind of spilled into the European session,” Oanda Corp senior market analyst Edward Moya said.
The FTSE 100 ended the month down 0.07 percent, snapping a winning streak of five consecutive months, as losses in banks, oil stocks and personal goods shares offset gains in insurance, real-estate and homebuilder stocks.
Concerns that rising inflation could lead the Bank of England to pull back monetary support, a jump in local COVID-19 infections and uncertainty over future earnings growth have somewhat outweighed optimism around robust quarterly earnings and bumper dividend payouts.
“England is still going to win the battle against COVID, it’s just the economic recovery is slightly delayed, and all the earnings growth might just get pushed off into another quarter,” Moya said.
Apple Inc’s iPhone 13 debut was met with a stock slump on Tuesday, keeping with a tradition of poor share price performance on the day new devices are unveiled. Shares of the technology giant sank after Apple executives, including chief executive officer Tim Cook, presented the new lineup of phones and other devices. The stock fell 1 percent to close at US$148.12 in New York trading. Prior to Tuesday, Apple’s shares fell on three-quarters of the days Apple unveiled new iPhones, data compiled by Bloomberg showed. Excluding Apple’s 8.3 percent rally on the day cofounder Steve Jobs announced the first iPhone in
As Google expands its footprint in Taiwan, it plans to recruit software and hardware talent for its Google Nest smart device team, a chip development team, and teams to support its Pixel and Chromebook products, Google Taiwan said yesterday. Supply chain management talent will also be in demand, the company said at an online event. “There will always be openings for software engineers, hardware engineers and project managers,” Google Taiwan human resources head Vanessa Lu (呂亞樵) said. “The strength of the Taiwanese industry is very clear,” Lu said, adding that the company would continue to invest in Taiwan. Lu also doused some
BEATING SCHEDULE: Government plans are for nacelle assemblies to be totally local from next year, but Orsted Taiwan said that it was going ‘above and beyond’ Wind turbine manufacturer Siemens Gamesa Renewable Energy SA yesterday inaugurated Taiwan’s first nacelle assembly plant at the Port of Taichung, its first assembly facility for offshore nacelles outside Europe. Vice Premier Shen Jong-chin (沈榮津), a long-time champion of Taiwan’s ambitions to become a regional hub in the offshore wind farm industry, described the plant as a “milestone” at a ceremony at the plant. “The completion of Siemens Gamesa’s nacelle assembly plant is a milestone for the development of the offshore wind farm industry in Taiwan and a step toward localizing the supply chain,” Shen said. “This is only the beginning. My great hope
ROBUST DEMAND: 5G, AI and Internet of Things technologies are driving growth and employment, as the company plans a new plant in Hsinchu County Contract electronics manufacturer Wistron Corp (緯創) plans to invest about NT$11.1 billion (US$400.58 million) in Taiwan, in line with its global deployment strategy, the Ministry of Economic Affairs said on Friday. The company’s investment is also a demonstration of robust demand for 5G, artificial intelligence (AI) and Internet of Things applications, the ministry said in a statement. Wistron, spun off from Acer Inc (宏碁) in 2001, is a notebook computer original design manufacturing partner to major PC brands. The company, which is based in Taipei’s Neihu District (內湖), also produces servers, data storage devices, game consoles and communications products for brand clients