Asia business sentiment drops, India optimistic but China, SKorea in dumps

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Some of the weakest readings came from China, South Korea and Taiwan, and Singapore, according to a business sentiment survey. (Reuters) Some of the weakest readings came from China, South Korea and Taiwan, and Singapore, according to a business sentiment survey. (Reuters)
SummaryOptimism returns to India, lifting its sentiment index higher at 67 after a drop in last quarter.

spooked markets, dealing a blow to business outlook.

The Thomson Reuters/INSEAD Asia Business Sentiment Index fell to a reading of 66 in September from 71 in the second quarter. A reading above 50 indicates an overall positive outlook.

AUSTRALIA: MODERATELY HIGHER (Index at 79 vs 75 Q2)

Corporate confidence in Australia rose to match highs hit in the first quarter of 2012 as the conservative coalition won a landslide victory in the federal election, bolstering sentiment. Incoming Prime Minister Tony Abbott has declared Australia as "open for business".

Of the seven respondents, four were positive while three remained neutral about the business outlook. In the previous quarter there were 14 respondents, with seven neutral and seven having a positive outlook.

The majority of respondents cited global economic uncertainty as their main source of concern and said the number of new orders remained the same.

CHINA: STEADY (Index at 50 vs 50 Q2)

Business sentiment in China remained flat for a third consecutive quarter as all eight companies surveyed said their business outlook remained neutral.

Five respondents cited the world economy as their biggest concern while the remainder flagged rising costs as their primary worry. One respondent reported a rise in employment compared to none last quarter while three said new orders had increased.

INDIA: SLIGHT IMPROVEMENT (Index at 67 vs 63 Q2)

Optimism returned to India, lifting its sentiment index moderately higher after a drop last quarter.

Three respondents said their main concern was a shaky world economy while a rout in the rupee in August also rattled sentiment with a third of companies worried about foreign exchange rates. Two respondents reported a lift in employment while five said new orders had risen.

Political instability was also cited as a concern from one company.

Lupin Pharmaceuticals Ltd, India's fourth-largest drugmaker by sales, and electricals retailer Godrej & Boyce were among the participants.

JAPAN: STEADY (Index at 63 vs 63 Q2)

Business confidence remained steady in Japan at 63, its highest point since June 2010 among the 20 companies surveyed, which included tech giant Canon Inc and global pharmaceutical company Daiichi Sankyo.

Half the respondents said global economic uncertainty was a primary concern while the remainder cited rising costs and exchange volatility as roadblocks to any moves higher. Two companies saw an increase in employment while two had decreased; the remaining 16 saw the same levels as the previous quarter.

SOUTH KOREA: SIGNIFICANTLY LOWER (Index at 50 vs 64 Q2)

Corporate sentiment slumped to 2013 first-quarter lows of

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