Local securities brokerages underperform

Korea’s securities brokerage industry has been a big underperformer for the past year, buffeted by the resurfacing of the European debt crisis and other negative factors, data showed yesterday.

The return on the brokerage sector’s subindex stood at minus 30.6 percent during the past year, the third-worst record after minus 32.6 percent for medical and precision machines and minus 31.9 percent for chemicals, according to data by the Korea Exchange, the local bourse operator.

In addition, the yield on the brokerage subindex has been underperforming that of the benchmark Kospi for the third consecutive week.

As of Friday, the return on the brokerage subindex was down 2.25 percent from a week earlier, while the key index increased 0.06 percent over the cited period.

Market watchers said the securities brokerage industry has been pummeled by the persistent European fiscal crisis, which has prompted many investors to exit the stock market.

In May, European funds accounted for 72.4 percent of all money that left Korea amid mounting market jitters over a possible Greek exit from the euro zone, according to government data.

Yonhap