European shares on Friday fell after a stronger-than-expected US jobs report ramped up bets of another 75-basis-point-rate hike by the US Federal Reserve next month, while fears of a darkening growth outlook pushed shares towards weekly losses.
The pan-European STOXX 600 was down 0.76 percent to 435.72, extending losses from earlier in the day after US nonfarm payrolls were shown to increase by 528,000 jobs last month, the largest gain since February.
The benchmark has lost 0.59 percent this week, snapping two weeks in positive territory, on worries over dour economic data from the region, rising geopolitical tensions and fears that higher interest rates could tip the economy into a recession.
“The data published this week add to the evidence that a recession is just around the corner,” Capital Economics senior Europe analyst Jack Allen-Reynolds said.
Figures this week also showed eurozone retail sales plunged in June and factory gate prices continued to rise, while eurozone business activity contracted last month for the first time since early last year.
“Forward-looking indicators suggest that worse is to come... If we are right, the European Central Bank will raise interest rates more aggressively than is currently priced into the market, and the economy will underperform consensus forecasts,” Allen-Reynolds said.
Britain’s FTSE 100 also closed lower, but a weakening pound helped the UK blue-chip index log its third consecutive week of gains.
The FTSE 100 dipped 0.11 percent to 7,439.74, with shares in WPP PLC, the world’s largest advertising group, falling 8.8 percent after its annual sales outlook failed to excite investors expecting stronger forecasts.
The midcaps index finished down 0.5 percent as the global mood soured after a solid US jobs report for last month bolstered the case for the Fed to press ahead with interest rate hikes.
Still, the FTSE 100 marked weekly gains of 0.22 percent, as sterling came under pressure after the Bank of England (BoE) on Thursday warned of a long UK recession even as it raised interest rates by the most in 27 years.
The index has several global companies that draw a large part of their revenue overseas, so a weakening sterling benefits the stocks.
The central bank raised its Bank Rate by a half percentage point to 1.75 percent — the highest level since late 2008 — in an attempt to control soaring inflation, but said Britain would enter a recession at the end of the year and not emerge until early 2024.
“Central banks generally tend to soft soap when it comes to bad news, however the frankness behind the BoE’s economic assessment was as dark as it could be,” CMC Markets UK chief market analyst Michael Hewson said.
The government yesterday approved applications by Alphabet Inc’s Google to invest NT$27.08 billion (US$859.98 million) in Taiwan, the Ministry of Economic Affairs said in a statement. The Department of Investment Review approved two investments proposed by Google, with much of the funds to be used for data processing and electronic information supply services, as well as inventory procurement businesses in the semiconductor field, the ministry said. It marks the second consecutive year that Google has applied to increase its investment in Taiwan. Google plans to infuse NT$25.34 billion into Charter Investments Ltd (特許投資顧問) through its Singapore-based subsidiary Fructan Holdings Singapore Pte Ltd, and
Micron Technology Inc is a driving force pushing the US Congress to pass legislation that would put new export restrictions on equipment its Chinese competitors use to make their chips, according to people familiar with the matter. A US House of Representatives panel yesterday was to vote on the “MATCH Act,” a bill designed to close gaps in restrictions on chipmaking equipment. It would also pressure foreign companies that sell equipment to Chinese chipmaking facilities to align with export curbs on US companies like Lam Research Corp and Applied Materials Inc. The bill targets facilities operated by China’s ChangXin Memory Technologies Inc
Singapore-based ride-hailing and delivery giant Grab Holdings’ planned acquisition of Foodpanda’s Taiwan operations has yet to enter the formal review stage, as regulators await supplementary documents, the Fair Trade Commission (FTC) said yesterday. Acting FTC Chairman Chen Chih-min (陳志民) told the legislature’s Economics Committee that although Grab submitted its application on March 27, the case has not been officially accepted because required materials remain incomplete. Once the filing is finalized, the FTC would launch a formal probe into the deal, focusing on issues such as cross-shareholding and potential restrictions on market competition, Chen told lawmakers. Grab last month announced that it would acquire
SECOND-RATE: Models distilled from US products do not perform the same as the original and undo measures that ensure the systems are neutral, the US’ cable said The US Department of State has ordered a global push to bring attention to what it said are widespread efforts by Chinese companies, including artificial intelligence (AI) start-up DeepSeek (深度求索), to steal intellectual property from US AI labs, according to a diplomatic cable. The cable, dated Friday and sent to diplomatic and consular posts around the world, instructs diplomatic staff to speak to their foreign counterparts about “concerns over adversaries’ extraction and distillation of US AI models.” Distillation is the process of training smaller AI models using output from larger, more expensive ones to lower the costs of training a powerful new
RSS