— Japan MOF: Q1 Major Firm Sentiment -2.7 Pt Vs Q4 -2.5 Pt
— Japan MOF: Q1 Sentiment Projected at +1.1 Pt In Q4 Poll
— Japan MOF: Major Firm Sentiment Seen Q2 +1.3 Pt, Q3 +7.3 Pt
— Japan MOF: FY12 All Firm Capex Plans -0.3%
— Japan MOF: FY11 All Firm Capex Plans -0.4% Vs Q4 Poll +0.7%
— Japan MOF: FY12 All Firm Current Profit +6.7% Y/Y
— Japan MOF: FY11 All Firm Current Profit -6.4% Y/Y Vs Q4 -2.0%
TOKYO (MNI) – Business sentiment in Japan unexpectedly posted the
second straight drop in the first quarter but is forecast to rebound in
the months ahead on brighter global prospects and the yen’s pullback from
record highs, a quarterly government survey showed on Wednesday.
The business sentiment diffusion index for major Japanese firms
slumped to -2.7 points in the January-March quarter from -2.5 points in
the October-December quarter, according to the Ministry of Finance.
Food and chemical makers as well as services and wholesalers led
the fall in Q1.
In the previous survey released in December, the index for the
first quarter of 2012 was forecast to improve to +1.1 points.
The index is computed by subtracting the percentage of companies
reporting deteriorating business conditions from the percentage of those
reporting an improvement. A positive figure indicates the majority of
firms see butter business conditions.
The latest survey also showed that major firms’ sentiment is
expected to rebound to +1.3 points in the second quarter and further to
+7.3 points in the third quarter.
The survey showed that companies expect their combined capital
spending to fall 0.4 in fiscal 2011 ending on March 31, down from a 0.7%
increase projected in the December poll.
Manufacturers plan a 0.5% hike in spending on factories and offices
in the current fiscal year, down from a 2.8% increase seen in the
previous survey, while non-manufacturers forecast a 1.0% reduction in
capex, bigger than a 0.7% fall projected in the December poll.
For fiscal 2012, Japanese firms forecast a 0.3% fall in combined
capital spending, with manufacturers planning a 2.7% decline and
non-manufacturers projecting a 1.3% increase.
The survey also showed that firms’ current profits are expected to
fall 6.4% in fiscal 2011, down from a 2.0% decline forecast in the
previous survey, but they are forecast to rebound 6.7% in fiscal 2012.
The Finance Ministry and the Cabinet Office conducted the joint
survey on Feb. 15, covering 15,250 companies capitalized at Y10 million
or over, of which 12,017 replied.
At the time of the survey, the yen stood at Y78.47 to the dollar
after hitting a record high of Y75.32 last October, but it was still
stronger than the current level of around Y83.00, making exporters
cautious about their business plans.
Meanwhile, the Nikkei 225 stock index was recovering in
mid-February, quoted at 9,620.34, but it was still weaker than the
recent level of 10,000.
tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4835 **
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