Headwinds For SK Assets

Samsung Electronics reported Q4 earnings today, the release showed profit missed estimates. The firm painted a fairly pessimistic picture, cautioning on Q1 performance due to more intense smartphone competition and suppressed memory prices.

• South Korea's biggest company, approximately 33% of the KOSPI, reported net income for the period of KRW 6.45tn missing analyst' estimates of KRW 7.3tn. The company disclosed preliminary numbers earlier this month that showed operating profit rose by 26%.
• Competition intensified as Apple introduced its first 5G-capable iPhones and Chinese rivals put up aggressive opposition. Memory chip prices were weak during the period, though demand is starting to gradually improve. The firm said they anticipated demand for memory chips to pick up in the first half of 2021.
• Earlier in the session data showed manufacturers business confidence rose to 81 in January, from 77. While non-manufacturing business confidence rose to 70 from 64. Though these have picked up they still represent a contraction.
• The KOSPI is likely to come under pressure today after Samsung earnings and with a negative lead from the US where bourses saw the worst day since October. The weakness could permeate other assets in what looks set to be a risk off session.