Highlights-Japan business sentiment declines-BOJ tankan

TOKYO, Dec 14 (Reuters) - Business sentiment among big manufacturers sank to a two-year low, the Bank of Japan's tankan corporate survey showed on Friday.

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Following is a summary of details of the survey from a briefing by a central bank official:

- The diffusion index (DI) for big manufacturers' sentiment was plus 19, the lowest since September 2005 and marking the first decline in three quarters.

- The headline figure fell short of a consensus market forecast of plus 21. The index for March was seen at plus 15, showing that firms expect conditions to worsen in the next three months.

- Small manufacturers' index rose for the first time in four quarters to 2, while the outlook index was minus 3, falling below zero for the first time since March 2005.

- Large non-manufacturers' index fell four points from the previous survey to plus 16. The index for March was seen at 15, marking the first deterioration in the outlook in four quarters.

- Small non-manufacturers' index was minus 12, marking three consecutive quarters of declines and the lowest since June 2005, when it was also minus 12. The index for March was minus 17, showing a deterioration for seven quarters in a row.

- The index for large manufacturers' views on prices of their products stood at 3, the highest since February 1991, while that of non-manufacturers rose to 5, the highest since November 1991.

- The index for small manufacturers' views on procurement costs rose to 57 from 52 in the September survey, rising for the third consecutive quarter and highest since May 1980, when it was 77. The same index for non-manufacturers was 40, up from 33 in September and highest since November 1990, when it was 46.

- Large companies see capital investment for 2007/08 rising 10.5 percent, against an 8.7 percent rise in the previous survey, while small firms see capital expenditures falling 4.6 percent, improving from a fall of 10.5 percent seen in the September survey.

- Large manufacturers expect sales for 2007/08 to rise 5.5 percent, marking the sixth consecutive year of increase. Large non-manufactures also expect sales to rise 3.7 percent, increasing for the fifth year in a row.

- Small firms expect their current profits to fall 2.3 percent in 2007/08. It would be the first fall since 2001/02.

- The employment index for all companies was minus 10, compared with minus 9 in September. A minus figure indicates that companies feel they need to hire more.

- The employment index for large non-manufacturers was minus 20. Their eagerness to hire more was the highest since May 1992, when it was minus 26.

- The same index for small non-manufacturers was minus 11, showing an increase in their readiness to hire more for the first time in three quarters.

- The index for large companies' financing conditions was 20, compared with 21 in September, marking the first decline in two quarters. The same index for small companies was minus 3, falling for two quarters in a row and marking the worst since September 2005, when it was also minus 3. (Reporting by Yuzo Saeki)