Japanese big makers'' confidence finally up after quake

Business confidence among major Japanese manufacturers improved in September for the first time since the March 11 earthquake, as production and exports recovered to pre-disaster levels led by automakers, the Bank of Japan (BOJ) said Monday. The central bank's closely watched quarterly survey showed the business sentiment index among big makers in the country, a key indicator of Japanese business trends, grew to 2 from minus 9 in the previous June survey, returning to positive territory after a plunge three months earlier. Confidence among large retailers, banks, real estate companies, and other non-manufacturers also improved to 1 in the July-September period from a reading of minus 5 in the previous quarter. The central bank's "tankan," which means short-term economic outlook, is Japan's most closely watched index of business confidence. The index represents the percentage of companies which are positive about their business minus the percentage of those who gave negative replies. A positive number means optimists outnumber pessimists. The improvement came despite increasing concerns over the eurozone debt crisis and a slowdown in US economy. The magnitude 9.0-earthquake and tsunami on March 11 left nearly 21,000 people dead or missing, destroyed many factories in northeastern Japan, and caused nationwide parts supply problems, especially for automakers, leading to sharp declines in production and exports and severely damaged Japanese economy. But the government said, last month, that supply-side constraints have been eased. By industry, big automakers' sentiment sharply rebounded from minus 52 in June to 13, the largest leap since the BOJ began polling the sector in 1992. The survey also showed big companies in both the manufacturing and non-manufacturing sectors plan to boost their capital spending on plants and equipment by 3.0 percent in fiscal 2011 through March 31 from the previous year. Looking ahead, large manufacturers expect their business sentiment index to rise to 4 in the next survey in December, and that for major non-manufacturers will remain 1, the central bank said. The latest survey was conducted between August 29 and September 30, covering 10,910 companies, of which 98.8 percent responded.