South Korean firms' business sentiment outlook plunged to the lowest level in 17 months amid concerns over a U.S.-China trade war, a slump in domestic demand and a decline in working hours. 

According to a survey by the Korea Economic Research Institute on Friday, the nation's business survey index(BSI) outlook for July came to 90-point-seven, falling below the benchmark 100. 

Compared to June, the figure marked a sharp decline and is the lowest to be posted this year. 

The BSI measures corporate confidence. A reading of over 100 indicates that more companies are optimistic about their economic prospects than those that are pessimistic. This month's survey assessed companies that ranked within the top 600 in terms of recent sales.