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Optimism high among large firms

Kyodo

Sentiment at major companies in the July-September quarter soared to a record high as the weakened yen fueled exports and drove stock prices higher, a government survey said Wednesday.

The “corporate economy projection” index covering firms capitalized at ¥1 billion or more hit 12.0 in the third quarter, up from 5.9 for the previous quarter and its highest level since comparable data became available in 2004, the joint survey by the Finance Ministry and Cabinet Office said.

The confidence index is calculated by subtracting the percentage of companies reporting deteriorating business conditions from those observing improvement.

Sentiment at manufacturers jumped to 15.2 from 5.0 as Prime Minister Shinzo Abe’s mix of well-telegraphed aggressive monetary easing, massive fiscal spending and growth promises, dubbed “Abenomics,” drove down the yen, reviving exports and driving up the stock market.

Nonmanufacturers’ sentiment rose to 10.4 from 6.4.

Looking ahead, large firms expect business conditions to continue picking up over the next six months.