According to LSEG's IBES data, analysts cut Asian companies' forward 12-month profit estimates by 0.3% in October, the third successive month of downgrades."A sluggish growth recovery in China is one of the main reasons for downward earnings revisions," said Rajat Agarwal, an Asia equity strategist at Societe Generale.
Prerna Garg, an equity strategist at HSBC, said earnings growth is set to slow in 2024 in most of Asia. She added that China's profit estimates for 2023 by street analysts have been cut to 18% now from 24% in August. LSEG data reveals that 53% of Asian companies reporting thus far have fallen short of consensus estimates, with 58% having reported.
Minyue Liu, an investment specialist at BNP Paribas Asset Management, cautioned that normalisation in external demand, China's uneven recovery, inflationary headwinds, and geopolitical uncertainties could lead to short-term market fluctuations.