Economic growth in emerging market economies remained sluggish in May, but India expanded at a better rate than the three BRIC peers China, Russia and Brazil, an HSBC survey said on Thursday.
During May, the HSBC composite index for India, which maps both manufacturing and services sectors, stood at 52, whereas for China it was 50.9, Brazil (51.2) and Russia (51). An index measure of above 50 indicates expansion.
"India has been the bright spot among the largest EM countries, while a combination of external headwinds and domestic issues has led to weakening growth in Brazil, China and Russia," Andre Loes HSBC Chief Economist, LATAM said.
Meanwhile, the HSBC Emerging Markets Index, a monthly indicator derived from the PMI surveys, was unchanged from April at 51.4 in May, indicating a muted rise in global emerging market output.
Growth slowed in China, Brazil and Russia, but accelerated slightly in India on the back of a stronger service sector performance.
However, manufacturing production declined in India, as well as in Taiwan and Vietnam. Chinese production rose only marginally.
New business growth in emerging markets slowed in May, and was the second-weakest in four years.
Manufacturing new orders were virtually unchanged since April, weighed down by a second successive drop in new export orders.
Employment rose marginally in May, having been broadly flat in April.
This was despite goods producers registering a fractional cut in staffing, HSBC added.
Meanwhile, the HSBC Emerging Markets Future Output Index that tracks firms' expectations for activity in 12 months time rose for the first time in three months in May.
Improved sentiment was driven by the service sector, as manufacturing output expectations were the weakest in five months, HSBC said.