A look at the day ahead in European and global markets from Rae
Wee
The global chip rout extended into Friday, with stocks in Taiwan
and Japan bearing the brunt of the beating, while South Korean
shares were spared as markets there were closed for a holiday.
Even higher-than-expected 77% earnings growth from TSMC
the previous day failed to impress investors, as
shares of the Taiwanese chip manufacturing giant sank 4%.
The moves across Asia set Europe up for a bumpy start.
EUROSTOXX 50 futures slid 0.9%, while DAX futures
were off 0.6%.
After a stellar run this year, investors have begun pulling
back from crowded semiconductor trades, with concerns over heavy
AI spending returning to the fore.
In a reflection of investor caution, the over-subscription rate
of Chinese memory chip giant CXMT's $8.6 billion
initial public offering came in much lower than most recent
Chinese IPOs.
Meanwhile, U.S. President Donald Trump declassified intelligence
on Thursday that he maintained showed Chinese interference in
U.S. elections, reviving his long-running attacks on election
security despite a U.S. intelligence assessment that found no
evidence Beijing affected the 2020 vote that he lost.
Markets appeared to brush off his accusations, but Trump's harsh
language about China risks rocking a relationship that has
steadied following last year's costly trade war.
Trump hopes to meet with Chinese President Xi Jinping in
September about improving trade relations.
Fighting in the Middle East continued, as Iran said it launched
fresh attacks on U.S. facilities in the Gulf on Friday after a
sixth consecutive night of U.S. strikes on Iranian military
facilities.
Over in China, the country's foreign exchange regulator said on
Friday it is allocating fresh quotas for qualified institutional
investors' overseas investments, following a recent crackdown on
illegal cross-border capital flows.
Key developments that could influence markets on Friday:
- U.S. import prices, industrial production and housing data
- Company earnings including Swedbank, Danske Bank ( DNSKF ), Sweco,
Volvo, Burberry Group ( BBRYF )
- Reopening of 1-month, 3-month and 6-month UK government
debt auctions
(Editing by Sonali Paul)