European stocks resumed their losses this week as interest-rate cuts failed to ease concern the economy and corporate earnings will deteriorate.
The Dow Jones STOXX 600 Index dropped 1.1 percent in the five days, following the steepest weekly gain since 2001 a week earlier.
ArcelorMittal sank 13 percent after the world’s biggest steelmaker cut production and Lafarge SA slid 9.4 percent as the largest cement producer abandoned its 2010 earnings target. Money managers Man Group PLC and 3i Group PLC dropped more than 10 percent after the value of their assets declined.
Europe’s STOXX 600 retreated 2.47 to 219.6, taking this year’s loss to 40 percent as almost US$700 billion in credit losses dragged down economic growth. Profit concern this week also overshadowed speculation that US President-elect Barack Obama may boost growth with a stimulus package.
Policymakers in the euro zone, the UK, Switzerland and Denmark lowered rates to ease the effects of the global credit squeeze. The Bank of England unexpectedly cut its benchmark lending rate by 1.5 percentage points to the lowest since 1955. The European Central Bank reduced borrowing costs by 50 basis points to 3.25 percent.
Analysts have scaled back their estimates for this year’s profits at STOXX 600 companies to a 6.8 percent drop, from an 11-percent increase forecast at the start of the year, Bloomberg data show.
The European Commission said on Monday the region’s economy probably entered a recession in the third quarter and trimmed its growth forecast for this year to 1.2 percent from 1.3 percent.
The STOXX 600 declined 13 percent last month, its worst monthly performance since September 2002, even after climbing 12 percent in the previous week.
National benchmark indexes fell in seven of 18 western European markets.
Germany’s DAX Index dropped 1 percent. France’s CAC 40 slipped 0.5 percent, while the UK’s FTSE 100 advanced 0.3 percent.
AIR DEFENSE: The Norwegian missile system has proved highly effective in Ukraine in its war against Russia, and the US has recommended it for Taiwan, an expert said The Norwegian Advanced Surface-to-Air Missile Systems (NASAMS) Taiwan ordered from the US would be installed in strategically important positions in Taipei and New Taipei City to guard the region, the Ministry of National Defense said in statement yesterday. The air defense system would be deployed in Taipei’s Songshan District (松山) and New Taipei City’s Tamsui District (淡水), the ministry said, adding that the systems could be delivered as soon as the end of this year. The US Defense Security Cooperation Agency has previously said that three NASAMS would be sold to Taiwan. The weapons are part of the 17th US arms sale to
SERIOUS ALLEGATIONS: The suspects formed spy networks and paramilitary groups to kill government officials during a possible Chinese invasion, prosecutors said Prosecutors have indicted seven retired military officers, members of the Rehabilitation Alliance Party, for allegedly obtaining funds from China, and forming paramilitary groups and assassination squads in Taiwan to collaborate with Chinese troops in a possible war. The suspects contravened the National Security Act (國家安全法) by taking photos and drawing maps of key radar stations, missile installations and the American Institute in Taiwan’s headquarters in Taipei, prosecutors said. They allegedly prepared to collaborate with China during a possible invasion of Taiwan, prosecutors said. Retired military officer Chu Hung-i (屈宏義), 62, a Republic of China Army Academy graduate, went to China
REGIONAL PEACE: The US is supporting Taiwan’s self-defense capabilities by providing the nation with defensive arms and services, as it aims to maintain cross-strait stability The US on Friday reiterated its support for Taiwan’s self-defense capabilities in a statement affirming its commitment to the Indo-Pacific region. The White House said that Washington has supported Taiwan’s self-defense capabilities through a range of security assistance authorities and resources, including the first-ever use of Foreign Military Financing (FMF) and Presidential Drawdown Authority (PDA) for Taiwan, as well as International Military Education and Training (IMET). US President Joe Biden had identified the Indo-Pacific as the critical region for the future of the US and the world, it said. “In pursuit of regional peace, security and stability, we have reinvested in our defense
INSURRECTION: The NSB said it found evidence the CCP was seeking snipers in Taiwan to target members of the military and foreign organizations in the event of an invasion The number of Chinese spies prosecuted in Taiwan has grown threefold over a four-year period, the National Security Bureau (NSB) said in a report released yesterday. In 2021 and 2022, 16 and 10 spies were prosecuted respectively, but that number grew to 64 last year, it said, adding that the Chinese Communist Party (CCP) was working with gangs in Taiwan to develop a network of armed spies. Spies in Taiwan have on behalf of the CCP used a variety of channels and methods to infiltrate all sectors of the country, and recruited Taiwanese to cooperate in developing organizations and obtaining sensitive information
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