Asia business sentiment better, global worries persist

Business sentiment among Asia's top companies improved slightly in the fourth quarter, reversing two consecutive quarters of declines, while global economic uncertainty remained the biggest concern for the region's firms, a Thomson Reuters/INSEAD survey showed.

The Thomson Reuters/INSEAD Asia Business Sentiment Index rose to 63 in the fourth quarter from 62 in the third quarter of 2012, having peaked at 80 in the first quarter of 2011. A reading above 50 indicates an overall positive outlook, while one below 50 points to pessimism.

The result showed a stark contrast between companies in Southeast Asia, a region of about 600 million people now benefiting from an increase in foreign investment, and manufacturing-heavy northeast Asia, which is more susceptible to the global economic outlook.

China, where exports support an estimated 200 million jobs, showed the most positive response in the northeast Asian region, but companies in other export-focused economies such as Japan, South Korea and Taiwan remained more cautious.

The index surveyed more than 100 of the Asia-Pacific region's top companies in 11 economies. There were 96 responses.

The poll, conducted by Thomson Reuters in association with INSEAD, a global management and business school, was compiled between December 3-14 and covered sectors such as autos, finance, property, resources and technology.