Asian companies 'more optimistic'
Asia's top companies have become more optimistic about their business outlook with the retail and shipping industries rebounding sharply in the second quarter of 2013, according to a Thomson Reuters survey.
- Published: 19/06/2013 at 01:16 PM
- Newspaper section: breakingnews
The Thomson Reuters/INSEAD Asia Business Sentiment Survey found that the sentiment index climbed six points to 71 in June, its highest level in five quarters and the third consecutive quarterly rise. A reading above 50 indicates a generally positive outlook.
Global economic uncertainty remains the biggest business risk across most countries and sectors, but 44% of the 91 companies that participated in the poll are now positive about their outlook, up from 30% in the previous quarter.
However, the business sentiment in Thailand dropped to an all-time low of 42, compared with 60 in March and 75 in December 2012. Of six companies questioned in Thailand, five were neutral and one was negative.
India experienced a similar decline in business sentiment, dropping to 63, compared with 80 three months ago, due to worries about rising costs.
Corporate sentiment in China, the world's second-largest economy, remained unchanged at its record low of 50 for two consecutive quarters, as companies worried about rising costs and global economic uncertainty.
"If you go back a year ago, there is a lot of concern about the global economy - a hard landing in China, a collapse in Europe, and double dip in the U.S. Some of those fears are still around, but they have certainly faded over the course of last year," said Shane Oliver, chief economist at AMP Capital Investors.
"So whilst companies in Asia still worry about China, it's about whether the growth is 7.5% or 7.8. Some of the more extreme fears that were seen a year ago continue to fade, showing a gradual pick-up in company optimism."
Corporate sentiments showed gains in Indonesia, Japan, Australia and South Korea.
The sentiment index in Japan rose to the highest level in three years as aggressive monetary stimulus started to revive its economy.
Of 19 Japanese respondents to the survey, which included Daiichi Sankyo Co Ltd, Toshiba Corp, Hitachi Ltd and Sharp Corp, five were positive about their outlook and 14 were neutral. In the previous survey, only one out of 22 participants was positive.
Australia and Indonesia saw big improvements in their outlook and were among the most optimistic economies in Asia.
Australia continued to improve in the second quarter, driving the country's sentiment index to its highest level since the first quarter 2012, although more participants were worried about the global economy.
See full survey highlight: Asia Business Sentiment Index rises for the third consecutive quarter
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- Writer: Online Reporters