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Sony Shares Sink on Earnings Revision

Investors reacted to Sony's earnings revision by pushing the price of its shares down to levels not seen for 13 years on Friday morning.

The shares were trading at ¥2,015, down 12 percent, going into the lunchtime break on the Tokyo market. That's a little off the low point of the morning of ¥1,983 recorded just before 10 a.m.

On Thursday evening Sony revised down its financial outlook for the full year due to lower sales of key products as a result of the slowing economy and the strong Japanese yen. Its net profit outlook for the year from April 2008 to March 2009 was cut by 38 percent to ¥150 billion (US$1.5 billion). And sales for the year were revised down slightly to ¥9 trillion.

Sony blamed the strong Japanese yen, which makes its products more expensive overseas and reduces the value in yen of profits brought back to Japan, and weak demand for key products including Bravia LCD (liquid crystal display) TVs, Cybershot digital cameras and Handycam digital video cameras.

Sony's warning also pulled down the entire consumer electronics sector. Many of Japan's large electronics companies are big exporters and the strengthening yen will likely hit them too.

At the lunchtime break Panasonic shares were down 8 percent, Sharp down 9 percent and Toshiba down 8 percent.

The entire market as measured by the Nikkei 225 index was down 414 points, or 5 percent, at 8,047 points at 11a.m.

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