European stocks fell for the first week in more than a month as investors speculated share prices have outpaced the outlook for economic growth and companies from Aegon NV to Nestle SA posted lower earnings.
Aegon, the Dutch owner of US insurer Transamerica Corp, slumped 12 percent, while Nestle, the world’s biggest food company, sank 4.4 percent. Volkswagen AG plummeted 24 percent after saying it will pay about 3.3 billion euros (US$4.7 billion) for a stake in Porsche SE’s automotive unit.
Europe’s Dow Jones STOXX 600 Index lost 0.8 percent to 228.77 in the past week, snapping four weeks of gains. A 45 percent rebound since March 9 has left the regional measure valued at 39.9 times the profits of its companies, the most expensive since September 2003, weekly data compiled by Bloomberg show.
“In the short term you have to be cautious, equities are no longer very cheap,” said Manfred Hofer, head of equity analysis at LGT Capital Management in Pfaeffikon, Switzerland, which oversees about US$73 billion. “Companies have been able to post profits because of cost cutting. We now need to see economic data confirm an upturn, then it’s possible that profits and revenues will increase.”
The euro region’s economy contracted 0.1 percent in the second quarter as Germany and France unexpectedly returned to growth, suggesting Europe’s worst recession since World War II is coming to an end. Economists had estimated gross domestic product declined 0.5 percent in the three months through June, the median of 32 forecasts in a Bloomberg survey showed.
Bank of England Governor Mervyn King said that while recent economic reports are “encouraging,” growth won’t resume on an annual basis until 2010 while banks restrict access to credit.
National benchmark indexes declined in 10 of the 18 western European markets. The UK’s FTSE 100 lost 0.4 percent, and France’s CAC 40 decreased 0.7 percent. Germany’s DAX dropped 2.8 percent as Daimler AG slid.
Aegon tumbled 12 percent. The Dutch insurer posted a fourth straight quarterly loss on writedowns and the sale of a unit and said it will sell 1 billion euros of shares to help repay state aid. The second-quarter net loss was 161 million euros, wider than analysts’ estimates, and compared with a profit of 276 million euros a year earlier.
An Emirates flight from Dubai arrived at Taiwan Taoyuan International Airport yesterday afternoon, the first service of the airline since the US and Israel launched strikes against Iran on Saturday. Flight EK366 took off from the United Arab Emirates (UAE) at 3:51am yesterday and landed at 4:02pm before taxiing to the airport’s D6 gate at Terminal 2 at 4:08pm, data from the airport and FlightAware, a global flight tracking site, showed. Of the 501 passengers on the flight, 275 were Taiwanese, including 96 group tour travelers, the data showed. Tourism Administration Deputy Director-General Huang He-ting (黃荷婷) greeted Taiwanese passengers at the airport and
STRAIT OF HORMUZ: In the case of a prolonged blockade by Iran, Taiwan would look to sources of LNG outside the Middle East, including Australia and the US Taiwan would not have to ration power due to a shortage of natural gas, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday, after reports that the Strait of Hormuz was closed amid the conflict in the Middle East. The government has secured liquefied natural gas (LNG) supplies for this month and contingency measures are in place if the conflict extends into next month, Kung told lawmakers. Saying that 25 percent of Taiwan’s natural gas supplies are from Qatar, Chinese Nationalist Party (KMT) caucus secretary-general Lin Pei-hsiang (林沛祥) asked about the situation in light of the conflict. There would be “no problems” with
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Taiwan pineapples are to be exported to the US for the first time later this year, after the US yesterday announced importation requirements, the Ministry of Agriculture said today. The US Animal and Plant Health Inspection Service yesterday published a draft of requirements to import Taiwanese pineapples, with a 62-day comment period, the ministry said in a news release. The US maintains strict requirements for imported fresh fruit, it said. The ministry’s Animal and Plant Health Inspection Agency applied to export pineapples to the US in 2020 and has since cooperated with the US to provide all the necessary information and reports, it
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