Intel Corp. (+0.9%) said it would invest $36 billion in chip production and research across Europe, including a brand new chip-making complex in Germany, to keep pace with surging demand for semiconductors. Chief Executive Pat Gelsinger Tuesday said Intel had selected the city of Magdeburg, Germany to put up what would be one of the biggest and most advanced semiconductor manufacturing facilities on the continent. The company plans 17 billion euros, the equivalent of about $18.6 billion, as a down payment on that facility. It is the second multibillion-dollar plant investment Intel has announced in 2022. Earlier this year, it selected Ohio to erect a brand new $20 billion chip-making facility that could expand to a $100 billion site. Intel last year said it would expand in Arizona and New Mexico, as well, as Mr. Gelsinger tries to gain a step on aggressive competitors. Beyond that, Mr. Gelsinger said the company, longer term, would invest a total of up to EUR80 billion ($87.5 billion) in Europe, including research and development facilities in France, as well as manufacturing facilities in Ireland, Italy, Poland and Spain. Intel said it expects to largely fund its investments through its cash flow and about $29.5 billion in cash and investments on hand at the end of the year, according to regulatory filings. It closed the period with about $38 billion in debt. The precise amount of cash needed will depend on the scale of government subsidies, the company said.

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The SMI index ended the day at 11,682 points, practically the same level as the previous day. Among the 20 SMI stocks, there were eleven price losers and eight price gainers; 46.9 (Monday: 47.0) million shares were traded. Defensive stocks were favoured while Swisscom (+1.7%) led the SMI. The heavyweight Nestle rose by 0.9 per cent. Pharmaceutical companies Roche (+0.5%) and Novartis (+0.3%) also gained slightly. Richemont ranked at the bottom with a minus of 3.4 per cent. Like other companies in the sector, the luxury products manufacturer is significantly dependent on business in Russia. Swatch fell by 4.1 per cent. Credit Suisse slipped by 1.7 per cent. The bank had announced that 4 percent of the securities held by its own asset management belonged to Russian clients and spoke of a serious situation.

European shares tumbled on Tuesday as investors reacted to a combination of lockdowns in parts of China to stem rising coronavirus cases and the latest Russia-Ukraine headlines. A possible interest-rate rise by the Federal Reserve this week added to the gloom. The Stoxx Europe 600 index lost 0.3% to 435.1 points. In Paris, the CAC 40 and the SBF 120 decreased by 0.2% and 0.3% respectively. In Frankfurt, the DAX 40 was down 0.1% and the FTSE 100 in London gave up 0.3%. Fears about Chinese growth led to a sharp decline in luxury goods stocks. Hermès lost 3.1%, LVMH 1.5% and Kering 1.3%. Solvay (-2%) announced its intention to split into two separate entities. The hotel group Accor (+0.7%) said on Tuesday that it plans to open more than 300 new hotels and resorts during 2022, after 288 in 2021. The company said the luxury and high-end segments would account for nearly 40% of the planned openings. Tyre manufacturer Michelin (+1.8%) announced on Tuesday that it would suspend its industrial activity in Russia. The group will also temporarily stop its exports to the country. In Frankfurt, airport operator Fraport lost 2.9% after publishing a lower-than-expected outlook for 2022, with traffic estimated this year to be between 55% and 65% of its 2019 level, while analysts were counting on 66%, according to Oddo BHF.

U.S. stocks climbed on Tuesday after a retreat in oil prices eased investors’ concerns about inflation and the prospect that the Federal Reserve will move more aggressively to lift interest rates. Oil’s decline came as investors waited for Wednesday’s decision by the Fed, which is expected to raise rates for the first time since 2018. Russia’s invasion of Ukraine had increased prices on the commodity well above $100 a barrel, raising the stakes for the U.S. economy and its central bank. The Dow Jones Industrial Average advanced 599.10 points, or 1.8%, to 33544.34. The S&P 500 climbed 89.34 points, or 2.1%, to 4262.45, while the Nasdaq Composite added 367.40 points, or 2.9%, to 12948.62. The major U.S. benchmarks opened higher and then gained strength throughout the afternoon. The S&P 500 and Nasdaq snapped three-day losing streaks. Oil prices dropped back below $100, undoing much of the price surge since Russia invaded Ukraine. West Texas Intermediate, the U.S. benchmark, dropped over 6% to $96.44 a barrel. Brent crude, the international benchmark, declined over 6% to $99.91 a barrel. Delta Air Lines closed at $34.86, up $2.79, or 8.7%. American Airlines rose $1.32, or 9.3%, to $15.57, and United Airlines climbed $3.22, or 9.2%, to $38.24. Russia’s invasion of Ukraine could weigh on global demand for oil, according to a monthly market report from the Organization of the Petroleum Exporting Countries. Energy shares retreated, as Valero Energy tumbled 6.8%, the most of any S&P 500 stock, losing $6.14 to close at $84.41. Baker Hughes slipped 5.7%, or $2.11, to $34.87. Exxon Mobil fell 5.7%, or $4.66, to close at $77.22.

In Asia, major indexes closed with gains. In Tokyo, the Nikkei 225 index advanced by 1.1 per cent. Japan Airlines (+4.5%) and shares from the electronics sector such as Renesas (+4%) are in demand. In Seoul (+1.1%), shares from the aviation and technology sectors also recovered. The Hong Kong stock market shows a clear recovery after the previous days' decline, with the Hang Seng Index rising by 5.3 per cent. Tencent jumped by 17.4 per cent. Meituan even soared by 20 per cent, Alibaba by 14.5 per cent. In Shanghai, prices are up by an average of 2.3 per cent.

The ten-year US-Treasury yield rose 1 basis point to 2.154%, after gaining more than 14 basis points on Monday. The two-year rate was flat at 1.867%, after jumping 11 basis points on Monday. The ten-year German Bund yield stood at 0.336%, down from 0.368% on Monday evening.

Berenberg cuts Hypoport target to EUR 500 (600) - Buy

Citi raises Bawag target to EUR 66 (65) - Buy

Citi reduces target British American Tobacco to 3,675 (3,750) p - Buy

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