“Samsung Electronics Co Ltd fell more than 5 percent on Thursday to its lowest in over four months, weighed down by analysts’ forecasts of lower quarterly earnings due to the strong won currency and weaker margins at its display business,” Joyce Lee and Miyoung Kim report for Reuters.
“Shares fell as much as 5.1 percent on Thursday to 1.302 million won, the lowest since late August. The stock closed down 4.6 percent, its fifth consecutive session of decline, a downtrend that has wiped nearly $18 billion off the market value of Asia’s most valuable company,” Lee and Kim report. “‘We expect Samsung’s performance to be about 9.5 trillion won, lower than the market consensus of around 10.2 trillion won. The biggest reason would be the won-dollar exchange rate, followed by shrinking margins in organic light-emitting diode (OLED) sales,’ said Lee Seung-woo, tech analyst at IBK Investment & Securities.”
“A stronger won is particularly bad for the profitability of Samsung’s component business as the unit mainly uses the U.S. dollar for settlement, analysts said,” Lee and Kim report. “The won’s rally has also dealt a blow to other major exporters, with shares of Hyundai Motor Co tumbling 5.1 percent and Kia Motors Co losing 6.1 percent.”
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