Australia’s biggest listed companies are at their gloomiest in two years, with mining and construction firms the most pessimistic.
National Australia Bank said the downbeat business confidence reading among the top 300 firms would affect medium-term business investment plans. "The forward orders aren't particularly strong at this stage," NAB's head of industry economics Dean Pearson said.
NAB's confidence barometer fell by 13 points to minus three during the last three months of 2014, putting it below the long-run average and at the lowest point since the December quarter of 2012.
The 300 biggest firms on the Australian Securities Exchange were even more pessimistic than smaller businesses. The mining companies were the most depressed, as commodity prices fell.
But record low interest rates failed to help the similarly gloomy construction sector, which includes apartment builders.
"It was a surprise, but this is a sector where it's encompassing all of construction - so you've got non-residential, residential and engineering," Mr Pearson said.
Manufacturers and recreational and personal services companies were also pessimistic.
But overall business conditions for ASX300 companies was still relatively strong, at eight points after suffering a three-point fall during the December quarter.
Profitability and trading conditions were also returning positive readings but employment conditions were in the negative zone.