On the other hand, jobs increased for the 10th straight month in the manufacturing sector, albeit only slightly
Reliance Industries cracked 4.42 per cent, while ITC, Kotak Mahindra Bank, InterGlobe Aviation, and HDFC Bank were also among the laggards. However, ICICI Bank, Sun Pharma, Hindustan Unilever, and State Bank of India were among the gainers.
The Nikkei India Services Purchasing Managers' Index, which tracks the services sector firms on a monthly basis, stood at 50.3 in February, up from 48.7 registered in January.
Benchmark indices Sensex and Nifty closed lower in a highly volatile trade on Thursday amid relentless foreign fund outflows and selling in blue-chip ICICI Bank. Falling for the second day in a row, the 30-share BSE Sensex declined 148.14 points or 0.18 per cent to settle at 83,311.01.
Market sentiment is likely to remain cautious as investors position themselves for the upcoming Union Budget and the US Fed's interest rate decision, where expectations are muted.
Among the Sensex firms, Kotak Mahindra Bank, Bajaj Finserv, Bajaj Finance, Adani Ports, Trent, State Bank of India, Titan and Tata Consultancy Services were the laggards. However, Maruti, Infosys, NTPC, Asian Paints, Eternal and Hindustan Unilever were among the biggest gainers.
The Nikkei India Services Purchasing Managers' Index (PMI), which tracks services sector firms on a monthly basis, stood at 48.7 in January, as against 46.8 in December 2016.
India's services industry expanded at its fastest pace in eight months in October as new business rose with discounting probably stoking demand, a survey showed on Wednesday.
While manufacturing firms cut jobs for the first time in 20 months to sharply reduce costs, services providers continued their hiring spree.
The Nikkei India Services PMI posted above the critical 50.0 level, which separates growth from contraction, for the fourth month running in May.
On the job front, Indian service providers continued to add to their payrolls and the sector witnessed the second-strongest increase in employment since March 2011.
The seasonally adjusted Nikkei India Services Business Activity Index fell to 50.2 in May, from 51.0 in April, pointing to the slowest growth rate in the current 12-month stretch of expansion.
However, predictions that economic conditions will normalise after the elections underpinned optimism regarding the outlook and supported a stronger upturn in employment.
With factory production, activities across the private sector saw the biggest drop in over three years
The headline seasonally adjusted Nikkei India Composite PMI Output Index, that maps both the manufacturing and services sectors, rose from 53.3 in June to 54.1 in July.
The services sector had slipped into contraction in July as confusion caused by the GST rollout triggered a dip in new business orders.
The survey noted that advertising campaigns supported the increase in new work growth in the sector amid competitive pressures.
Bajaj Finance, IndusInd Bank, State Bank of India, Maruti, Tata Motors, ITC, Tata Steel and Reliance Industries were also among the gainers. Nestle, NTPC, Kotak Mahindra Bank, Power Grid and Titan were among the laggards.
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.
Business confidence remained positive in August and was driven by upbeat forecasts of sales, an expected improvement in demand and promotional activities
Currency scarcity weighed on manufacturing performance where growth of new work flows slowed
The upcoming corporate results season and the approaching Union Budget kept investors on their toes
A reading below 50 means contraction in the sector.
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.
A reading above 50 indicates expansion, while a score below this mark means contraction
A reading above 50 means the sector is expanding, while a reading below 50 means contraction.
A reading above 50 indicates expansion while a one below this level means contraction.
Service providers' confidence with regard to the 12-month outlook for business activity remained positive.
It was the second straight week of gains for the benchmarks.
The BSE 30-share index after a positive opening stretched to 31,772.41, but could not stay there for long buffeted by the selling pressure. It hit a low of 31,562.25 before settling lower by 79.68 points, or 0.25 per cent, at 31,592.03.
A reading above 50 represents expansion while one below means contraction.
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.
In the Sensex pack, HCLTech rose the maximum by 3.12 per cent, followed by ITC which gained 2.73 per cent and M&M went up 2.61 per cent. TCS climbed 2.44 per cent. Tech Mahindra, Wipro, L&T and Maruti were among the other major gainers.
Investors went looking for bargain in banking, oil and gas and auto stocks.
The index went below the crucial 50 mark.
The higher rate cut by RBI is positive for rate-sensitive sectors in the medium to long term.
According to Japanese financial services major Nomura, India's manufacturing PMI remained in the expansion zone but suggested some consolidation after the rapid ramp up of activity in December.
On the employment front, services employment was unchanged in April.
The breadth, indicating strength of the market was strong
Out of 30 Sensex shares, 19 ended lower while 11 gained
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