Business sentiment last month remained listless among local manufacturers due to continued weak end-market demand, but a sizeable number are looking at business picking up ahead, as the high sales season for technology products approaches, the Taiwan Institute of Economic Research (TIER, 台灣經濟研究院) said yesterday.
The confidence gauge for the manufacturing industry was 89.3, shedding 2.02 points from April, as inventory adjustments lingered, TIER Economic Forecasting Center director Gordon Sun (孫明德) said.
However, the ratio of companies with positive views increased by 4.6 percentage points to 29.9 percent, while companies with a gloomy outlook fell by 0.7 percentage points to 24.4 percent, the monthly survey said.
Photo: CNA
Food, leisure and printing product manufacturers were upbeat, while suppliers of chemical, machinery and metal products, as well as transportation tools, were conservative, TIER said.
International research bodies recently raised GDP growth forecasts for the world, the US and Japan, lending support for the sentiment upturn, Sun said, adding that global firms also breathed a sigh of relief after the US Federal Reserve moved to keep interest rates unchanged.
“The worst is likely over, but it remains to be seen when the process of bottom building will come to an end and usher in a meaningful recovery,” Sun said.
The nation’s key economic barometers stay in negative territory, but their pace of decline has slowed down, he said.
Specifically, local firms in Apple Inc’s supply chains might benefit from its upcoming release of new iPhone series, and other electronics suppliers would enjoy growing demand for electric vehicles and artificial intelligence applications, the institute said.
Global technology brands might adopt a cautious approach to inventory building this time on concern inflation remains high, boding ill for spending on technology gadgets, Sun said.
Private consumption economic data appear to be the strongest, in light of robust retail revenue and auto sales, explaining why the business confidence among service providers edged up 0.57 points to 99.14, TIER found.
The rallies in the local bourse and foreign tourist arrivals helped drive up private consumption, Sun said.
Retailers, wholesale operators, restaurants, logistics and warehousing service providers are looking at continued business improvement in the coming six months, the institute said.
By contrast, construction companies and real-estate brokers stalled, as they remain under cost pressures despite raw material price declines, it said.
Furthermore, demand for housing and industrial factories subsided amid unfavorable policy measures, TIER said.
As a result, the sentiment reading for construction and property sectors dropped by 0.95 points to 93.47, it said.
HANDOVER POLICY: Approving the probe means that the new US administration of Donald Trump is likely to have the option to impose trade restrictions on China US President Joe Biden’s administration is set to initiate a trade investigation into Chinese semiconductors in the coming days as part of a push to reduce reliance on a technology that US officials believe poses national security risks. The probe could result in tariffs or other measures to restrict imports on older-model semiconductors and the products containing them, including medical devices, vehicles, smartphones and weaponry, people familiar with the matter said. The investigation examining so-called foundational chips could take months to conclude, meaning that any reaction to the findings would be left to the discretion of US president-elect Donald Trump’s incoming team. Biden
INVESTMENT: Jun Seki, chief strategy officer for Hon Hai’s EV arm, and his team are currently in talks in France with Renault, Nissan’s 36 percent shareholder Hon Hai Precision Industry Co (鴻海精密), the iPhone maker known as Foxconn Technology Group (富士康科技集團) internationally, is in talks with Nissan Motor Co’s biggest shareholder Renault SA about its willingness to sell its shares in the Japanese automaker, the Central News Agency (CNA) said, citing people it did not identify. Nissan and fellow Japanese automaker, Honda Motor Co, are exploring a merger that would create a rival to Toyota Motor Corp in Japan and better position the combined company to face competitive challenges around the world, people familiar with the matter said on Wednesday. However, one potential spanner in the works is
HON HAI LURKS: The ‘Nikkei’ reported that Foxconn’s interest in Nissan accelerated the Honda-merger effort out of fears it might be taken over by the Taiwanese firm Nissan Motor Co has become the latest buyout target in Japan as it explores a merger with Honda Motor Co and faces an overture from Hon Hai Precision Industry Co (鴻海精密), known as Foxconn Technology Group (富士康科技集團) internationally. Shares in Nissan yesterday jumped 24 percent, the most on record, to hit the daily limit, after the two Japanese automakers acknowledged that talks are ongoing to better position themselves for competitive challenges during a time of upheaval in the global auto industry. Foxconn — a Taipei-based manufacturer of iPhones, which has been investing heavily in factories to build electric vehicles — has also
CHIP SUBSIDY: The US funding would help alleviate the financial pressure from building two fabs in the US and should lift gross margins in 2026, the company said GlobalWafers Co (環球晶圓), the world’s third-largest silicon wafer supplier, yesterday said it is to receive US$406 million in subsidies from the US Department of Commerce for two new US fabs under the CHIPS and Science Act, with the first batch of the funds likely coming next year. The grant represents 10 percent of the planned investments of US$4 billion in advanced semiconductor wafer manufacturing facilities in Texas and Missouri, GlobalWafers said. The commerce department is to disburse the funds based on the completion of project milestones over a multiyear timeframe, the company said. Along with the tax credit, which is equal to
RSS