Pessimists outnumbered optimists among large manufacturers for the first time in more than a year due to the March 11 disaster, the Bank of Japan's Tankan survey showed on July 1.
Pessimists outnumbered optimists among large manufacturers for the first time in more than a year due to the March 11 disaster, the Bank of Japan's Tankan survey showed on July 1.
The diffusion index among large manufacturers fell 15 points to minus 9, the first negative reading since March 2010, according to the quarterly business confidence survey for June.
Still, corporate sentiment will likely improve sharply in the coming months because production is recovering more swiftly than expected.
The diffusion index is projected to rebound to 2 in September.
The index is calculated by subtracting the percentage of companies reporting unfavorable business conditions from the percentage of companies reporting favorable conditions.
A negative reading means there are more pessimists than optimists.
The 15-point decline was the largest since March 2009, when the index plunged 34 points to minus 58 following the collapse of U.S. investment bank Lehman Brothers.
The diffusion index for the auto sector dropped 75 points to minus 52, marking the steepest decline since auto industry figures became available in November 1992.
The survey was conducted between May 30 and June 30 covering 10,997 companies nationwide, 98.2 percent of which responded.
The June survey was the first to reflect the impact of the Great East Japan Earthquake because most responses to the March survey were submitted before the disaster.
The diffusion index for large nonmanufacturers fell 8 points to minus 5. The index is projected to improve to minus 2 in September.
The diffusion index for small and midsize manufacturers dropped 11 points to minus 21, while that for small and midsize nonmanufacturers slid 7 points to minus 26.
Many economists say the economy has already seen the worst since the Great East Japan Earthquake.
Both the government and the BOJ upgraded their economic assessments in June.
The BOJ has said the economy will return to a moderate recovery path from the latter half of the current fiscal year.
Still, economists are anxious about the outlook of overseas economies, including the United States, Europe and emerging economies.
Electricity shortages due to the accident at the Fukushima No. 1 nuclear power plant also remain a concern.
(This article was compiled from reports by Hirobumi Ohinata and Toru Hatanaka.)