European stocks posted their biggest weekly gain this year as the US Federal Reserve said its stimulus policy will remain responsive to economic data and as companies from Renault SA to ThyssenKrupp AG beat profit estimates.
As Europe’s third-largest carmaker climbed 13 percent and Germany’s biggest steelmaker advanced 6.3 percent, Fresnillo PLC and Polymetal International PLC le d mining stocks higher, jumping at least 11 percent as precious metals rallied.
On the losing side this week was Rolls-Royce Holdings PLC, which tumbled 13 percent after announcing that this year, its sales will fail to grow for the first time in a decade.
The STOXX Europe 600 Index rose 2.5 percent to 333.32 this week — its largest increase since Dec. 20 last year — as investors assessed Fed Chair Janet Yellen’s testimony to the US Congress. The benchmark is less than 1 percent below the six-year high it reached last month.
The gauge slid 5.5 percent between Jan. 22 and Feb. 4 as investors weighed cuts to the Fed’s bond-buying program, China’s economic slowdown and volatility in emerging markets.
“Yellen’s comments indicated a continuation of policies from where the previous incumbent left off,” SVM Asset Management Ltd’s Hugh Cuthbert said by telephone from Edinburgh.
“We’re seeing some glimmers of positivity in European earnings. Markets are focusing on the potential for improvement. The severe reaction to negative news, as in the case of Rolls-Royce, shows that the market is becoming discriminatory, which is a good thing,” he added.
The volume of shares changing hands in STOXX 600-listed companies fell 13 percent from last week. A gauge that measures options traders’ expectations of volatility in the Euro STOXX 50 Index posted the biggest drop since Oct. 18 last year.
National benchmark indices climbed in all Western European markets except Iceland this week. The UK’s FTSE 100 added 1.4 percent, France’s CAC 40 rose 2.7 percent and Germany’s DAX rallied 3.9 percent.
The eurozone economy expanded for a third consecutive quarter for the first time since March 2011, a release showed on Friday. GDP for the three months through December last year grew 0.3 percent, exceeding estimates, data from the EU’s statistics office in Luxembourg showed.
A gauge of miners posted the second-best performance among the 19 industry groups in the STOXX 600, while a gauge of auto companies posted the biggest weekly rally since July last year to reach its highest level in at least 27 years, data compiled by Bloomberg showed.
Michelin & Cie climbed 8.9 percent after Europe’s largest tiremaker said that it is sticking with its earnings target for next year and raised its full-year dividend by 4.1 percent.
Also this week, Italian Prime Minister Enrico Letta quit, ending a 10-month-old government, according to a statement by Italian President Giorgio Napolitano on Friday.
His resignation came after Matteo Renzi, general secretary of Italy’s Democratic Party, convinced his party to withdraw support for Letta.
COMPETITION: AMD, Intel and Qualcomm are unveiling new laptop and desktop parts in Las Vegas, arguing their technologies provide the best performance for AI workloads Advanced Micro Devices Inc (AMD), the second-biggest maker of computer processors, said its chips are to be used by Dell Technologies Inc for the first time in PCs sold to businesses. The chipmaker unveiled new processors it says would make AMD-based PCs the best at running artificial intelligence (AI) software. Dell has decided to use the chips in some of its computers aimed at business customers, AMD executives said at CES in Las Vegas on Monday. Dell’s embrace of AMD for corporate PCs — it already uses the chipmaker for consumer devices — is another blow for Intel Corp as the company
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TECH PULL: Electronics heavyweights also attracted strong buying ahead of the CES, analysts said. Meanwhile, Asian markets were mixed amid Trump’s incoming presidency Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) shares yesterday closed at a new high in the wake of a rally among tech stocks on Wall Street on Friday, moving the TAIEX sharply higher by more than 600 points. TSMC, the most heavily weighted stock in the TAIEX, rose 4.65 percent to close at a new high of NT$1,125, boosting its market value to NT$29.17 trillion (US$888 billion) and contributing about 400 points to the TAIEX’s rise. The TAIEX ended up 639.41 points, or 2.79 percent, at 23,547.71. Turnover totaled NT$406.478 billion, Taiwan Stock Exchange data showed. The surge in TSMC follows a positive performance
FUTURE TECH: Nvidia CEO Jensen Huang would give the keynote speech at this year’s Consumer Electronics Show, which is also expected to highlight autonomous vehicles Gadgets, robots and vehicles imbued with artificial intelligence (AI) would once again vie for attention at the Consumer Electronics Show (CES) this week, as vendors behind the scenes would seek ways to deal with tariffs threatened by US president-elect Donald Trump. The annual Consumer Electronics Show opens formally in Las Vegas tomorrow, but preceding days are packed with product announcements. AI would be a major theme of the show, along with autonomous vehicles ranging from tractors and boats to lawn mowers and golf club trollies. “Everybody is going to be talking about AI,” Creative Strategies Inc analyst Carolina Milanesi said. “From fridges to ovens
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