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The HSBC Emerging Markets Index, a monthly indicator derived from the PMI surveys, continued its upward trajectory in November on the back of faster manufacturing growth.
Investor sentiment got a boost following remarks from the Russian President Putin that allayed fears of an imminent military conflict in Ukraine
India's manufacturing PMI rose to 54.5 in December, 2014, while in the corresponding period a year ago it stood at 50.7, just above the crucial 50 mark which separates growth from contraction.
Private sector output in India expanded for the first time in 8 months in February as slump in the services sector moderated and manufacturing grew at a stronger pace, an HSBC survey said.
Of the BRIC (Brazil, Russia, India and China) economies, China, Russia and Brazil posted sharper increases in activity, but India registered a fourth successive decline in output.
It indicates that the economy has remained frail at the start of the new fiscal year.
The recovery in manufacturing is still likely to prove "protracted" given the lingering structural constraints.
August witnessed the fastest pace of growth in new business orders since February.
The index, however has remained above the 50 mark - below which it indicates contraction - for more than three years now.
India's manufacturing sector witnessed a slowdown in July - the weakest growth rate since November - because of moderation in domestic and export orders amid sagging global economy, an HSBC survey said.
Bumper liquidity as a result of global central bank stimulus measures should prevent a sharper downturn.
The HSBC India Manufacturing Purchasing Managers' Index for the manufacturing industry climbed from 49.6 in October to 51.3 in November on the back of a rebound in new orders and output.
"Any lingering concern that India's manufacturing recovery was tailing off should be put off. A second consecutive rise in PMI has taken the series to a new cycle high consistent on double digit rise in industrial production," said Robert Prior Wandesforde, senior asian economist, HSBC.
Factory growth picked up in May.
Bumper liquidity as a result of global central bank stimulus measures should prevent a sharper downturn.
The new orders sub-index, which includes domestic demand as well as orders from abroad, rose to 53.2 in May
Although growth picked up slightly across the world's main emerging markets on an average, rates of expansion remain subdued
Recent reform measures announced by the government expected to boost the sector.
The 30- Share BSE Sensex ended 19924 up 22 points or 0.11 per cent, while the broader 50-share NSE Nifty closed down by 2 points or 0.01 pct at 5907.
The latest PMI showed inflation pressures ebbed further last month with both costs of raw material and prices charged rising at a slower pace than March.
The pace of activity in China's vast manufacturing sector quickened for the first time in 13 months in November, a survey of private factory managers found, adding to evidence that the economy is reviving after seven quarters of slowing growth.
Economic recovery in US, euro zone help; new orders sub-index at 52.4
HSBC's purchasing managers' index was released on Tuesday.
India's manufacturing expanded at a faster pace than China
ONGC, Sesa Sterlite, Tata Steel, RIL and HDFC emerged as the biggest losers
Expenditure cuts necessitated by slowing revenue growth, weak industrial activity worrisome portents
That prompted manufacturers to add jobs for the first time since June.
The survey showed firms passed on a greater cost burden to consumers. Prices charged rose at their fastest pace since October.
The HSBC Markit Services Purchasing Managers' Index fell to 51.7 in June from May's three-month high of 53.6, in a sign that Asia's third-largest economy is still struggling to climb out of a quagmire of low growth and high inflation.
India's manufacturing sector activity remained broadly flat in June as new orders declined for the first time in over four years and power cuts and fragile economic conditions weighed on the sector's performance, an HSBC survey said.
Investment trend by foreign investors will also be closely watched for stock movement
One of India's main export destinations, the euro zone, is struggling to revive its economy and battling disinflation.
The RBI left interest rates unchanged, saying there was no substantial development on inflation or fiscal fronts to warrant a fresh reduction.
India's private sector activity contracted further in August, reflecting faster contractions of both manufacturing and services output, amid decline in new orders and tough economic conditions.
The survey showed firms' confidence regarding future business grew at the slowest pace in a year last month.
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Although the survey pointed to the softness in demand leveling off, a complete recovery is still some way off.
Sensex hit a record high of 27,225.85 and Nifty hit a record high of 8,141.90 in the intra-day trades today.
The market breadth in BSE remains positive with 1,554 shares advancing and 1,196 shares declining.
Manufacturing growth in India lost momentum in February.
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