European stocks rose on Friday on a surge in technology stocks, strong earnings from France’s L’Oreal SA and a broad boost to sentiment provided by a surprise interest payment from debt-ridden China Evergrande Group (恆大集團).
The STOXX 600 added 0.5 percent to close at over six-week highs and logged its third consecutive week of gains, up 0.5 percent.
News that the Chinese property developer had made a bond payment to avert a default lifted the mood globally. Worries about contagion from a potential default have rattled markets recently.
France’s blue-chip CAC 40 rose 0.7 percent and outperformed its European peers, riding on a 5.1 percent surge in L’Oreal shares following the cosmetics company’s strong results.
Shares in Dutch semiconductor equipment maker ASML Holding NV and German software firm SAP SE rose 3.2 percent and 1.2 percent respectively, after stumbling earlier this week following their results. The tech sector rose 1.5 percent.
Investors appeared to look past a survey that showed growth in eurozone business activity slowed this month as firms face soaring costs due to supply chain constraints, while the bloc’s dominant service industry struggled amid COVID-19 concerns.
Automaker Renault SA and Continental AG flagged chip shortages hitting output and margins.
“We’ve lots of earnings beats on lowered expectations, and then you’re getting comments from CEOs suggesting supply chains are damaged — but certain firms have said that they’re on top of it,” said Keith Temperton, sales trader at Forte Securities. “That’s hopeful for the markets.”
A bunch of upbeat earnings lifted Wall Street’s S&P 500 to a record high, while its European counterpart is less than 1 percent shy of its August peak.
Europe Inc is expected to see a 47.6 percent rise in third-quarter profit to 96.1 billion euros (US$112 billion), latest data from Refinitiv IBES showed, a slight improvement from last week’s 46.7 percent growth forecast.
Eurozone inflation expectations hit their highest levels in years, putting additional pressure on the European Central Bank over its insistence on maintaining crisis-era stimulus. The central bank is set to meet next week.
“That inflation is transitory does not necessarily mean that it is short-lived. An adjustment of supply to the changes in patterns of demand caused by the pandemic may be slow, and keep upward pressure on prices for longer,” strategists at Citigroup Inc wrote in a note.
Swedish mining firm Boliden AB dipped 6.8 percent as its third-quarter operating profit fell below market forecasts.
Remy Cointreau rose 1.8 percent after it said it was growing increasingly confident about its full year outlook after second-quarter sales beat expectations.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
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