A reading above 50 indicates expansion while a one below this level means contraction.
India's manufacturing sector growth slowed marginally in February, although strong domestic orders were likely to support output expansion in the coming months, an HSBC survey has said.
Bumper liquidity as a result of global central bank stimulus measures should prevent a sharper downturn.
Input prices rose at their fastest rate in 14 months but manufacturers absorbed much of the increase
The improvement in business conditions promoted job creation, while confidence towards the year-ahead outlook for activity was at a four-month high during March.
Financials emerged as the top gainers while auto shares rallied on robust September sales
A reading above 50 means the sector is expanding, while a reading below 50 means contraction.
Manufacturing growth in India lost momentum in February.
The Nikkei India Services Purchasing Managers' Index, which tracks services sector companies on a monthly basis, stood at 52 in September, down from August's 43-month high of 54.7, pointing to a slower and moderate rate of expansion.
The Nikkei Markit India Manufacturing Purchasing Managers' Index (PMI) -- an indicator of manufacturing activity -- fell to 49.6, down from 52.3 in November, coming below the crucial 50 threshold which separates contraction from expansion.
Manufacturing production growth eased in May, which combined with the slowdown in services resulted in a weaker increase in private sector output, the survey said.
The NSE Nifty, however, ended a shade higher by 6.65 points or 0.06 per cent at 10,442.20
That prompted manufacturers to add jobs for the first time since June.
Regarding employment, the manufacturing sector hiring remained broadly unchanged.
The survey showed firms passed on a greater cost burden to consumers. Prices charged rose at their fastest pace since October.
The HSBC Emerging Markets Index, a monthly indicator derived from Purchasing Managers' Index surveys, inched up to 50.6 in May from 50.4 in April, indicating weak output growth across global emerging markets.
Losses largely came from the metal index, followed by power, infrastructure, realty, PSU, oil and gas, capital goods, FMCG, healthcare, auto and banking.
HSBC's purchasing managers' index was released on Tuesday.
The GST rate for the sector has not yet been finalised by the government.
A reading above 50 represents expansion while one below means contraction.
Manufacturing of consumer goods, like food and liquor continued to improve in September.
The NSE Nifty gained 77.85 points, or 0.71 per cent, to finish at 11,008.30. Intra-day, it shuttled between 10,821.55 and 11,035.65.
The Nikkei Markit India Manufacturing Purchasing Managers' Index increased to 50.7 in February
Supported by greater demand from both domestic and external markets, total new business rose at the fastest pace since March
India's manufacturing sector activity contracted for the third straight month in October amid falling levels of production and new orders, as the business climate within the country remained tough, an HSBC survey said on Friday.
The HSBC/Markit Purchasing Managers Index for the services industry fell to 46.7 in December from 47.2 in November, registering the sixth consecutive monthly drop in output levels, the longest period of continuous reduction since the 2008/2009 global financial crisis.
India's manufacturing sector activity contracted for the second consecutive month in September as both output and new orders witnessed a decline, an HSBC survey said.
The benchmark BSE Sensex ended down 2.23 per cent. The Bank Nifty fell 3.59 per cent.
n the broader market, both the BSE Midcap and Smallcap indices, were up 1.2% and 0.7% each.
Market sentiment suffered a jolt after other Asian markets closed with widespread losses and European markets dropped in early trade
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Likely to set the ball rolling for Rs 1.72-lakh-cr projects today
Although growth picked up slightly across the world's main emerging markets on an average, rates of expansion remain subdued
According to bankers and economists, there is room for further rate cut by the RBI as retail and wholesale inflation rates have remained benign.
The survey showed firms' confidence regarding future business grew at the slowest pace in a year last month.
The market breadth in BSE remains positive with 1,554 shares advancing and 1,196 shares declining.
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.
C Rangarajan, chairman, Prime Minister's Economic Advisory Council tells Business Standard that the measures taken by the government will lead to economic growth of at least 6 per cent in FY14 against a decadal-low growth of 5 per cent in FY13.
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Although the survey pointed to the softness in demand leveling off, a complete recovery is still some way off.
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.
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