Brokerages cut outlook for 61% of firms on Japan trade row

Korean brokerage houses have cut their third-quarter earnings forecasts for about 61 percent of major listed firms due to a Seoul-Tokyo trade spat, a market tracker said Monday.

As of Friday, local securities companies expected 61.2 percent of the 224 companies listed on the main stock market, or 137, to see their operating income for the July-September period get worse than predicted as of endJune, according to FnGuide.

Operating profits for 83 firms are projected to take a turn for the better, with estimates for the remaining four unchanged.

Out of the 137 firms, earnings forecasts for 131 firms have been trimmed. Three companies are expected to swing to a loss and as many enterprises are forecast to suffer wider losses.

The 224 companies cover businesses for which three or more local securities companies have put forward operating income forecasts.

Chip giant SK hynix has suffered the biggest downgrade. The company is predicted to post an operating income of 432.7 billion won ($357 million) for the third quarter, down a whopping 52.5 percent from end-June.

The median forecast for the third-quarter operating profit of Samsung Electronics, the world’s No. 1 memory chip and smartphone maker, has been cut by 7.6 percent to 6.94 trillion won.

Securities companies have also lowered third-quarter earnings forecasts for travel agencies amid a tumble in demand for flights to the neighboring country. (Yonhap)