The end of Japan’s first-quarter earnings has left non-manufacturing companies more pessimistic about the outlook for this fiscal year, contributing to the Topix index’s 10 per cent decline since the beginning of June.

Service sector companies, excluding financials, now expect recurring profits to decline 9.6 per cent this fiscal year compared with their May estimates of a 2 per cent rise, according to data of company forecasts compiled by Credit Suisse.