Adani Ports, HUL and L&T gained the most, while ICICI Bank, ONGC, GAIL and Tata Steel lost the most
A reading below 50 means contraction in the sector.
Although the survey pointed to the softness in demand leveling off, a complete recovery is still some way off.
Coal India topped the losers' list in the Sensex pack on Tuesday, falling 2.36 per cent, followed by Bharti Airtel at 2.16 per cent.
India's manufacturing expanded at a faster pace than China
Launched in September 2013, the Conference Board Leading Economic Index for India, conceptualised back to April 1990, has successfully signalled turning points in the economic cycles of India.
International education consultant NNS Chandra shares advice on how to pick the right international education.
Investors were focussed on the RBI's monetary policy review on Tuesday which will give an insight into its inflation and rates outlook.
Growth in the eight core sectors jumped to 8.5% in April, due to a sharp pick-up in refinery products and a commensurate rise in electricity generation.
Investors watch out for cues from the on-going winter session of the Parliament.
ONGC, Sesa Sterlite, Tata Steel, RIL and HDFC emerged as the biggest losers
Production at factories, mines and utilities likely rose an annual 2.4 per cent in August, up from July's 0.5 per cent rise, according to the survey of 26 economists.
Banking stocks felt the heat due to worries that the lending rate cuts will hit their bottom line
FMCG major ITC and private banking major ICICI Bank were the top Sensex losers
While analysts predicted the Sensex to cross 30,000 in 2016, the index currently stands 12% lower at 26,400.
The RBI left interest rates unchanged, saying there was no substantial development on inflation or fiscal fronts to warrant a fresh reduction.
The upcoming general elections will be the focus and the economy and market performance will pivot around that event. The general consensus is that the India stock market should be up around 10 per cent by the end of the year.
Bajaj Auto was the top gainer in the Sensex pack, surging 3.95 per cent followed by Maruti Suzuki at 2.69 per cent.
Expenditure cuts necessitated by slowing revenue growth, weak industrial activity worrisome portents
In dull trade, the rupee on Monday ended a mere two paise lower at 60.20 against the US dollar on weak local equities and imported-driven demand for the American currency.
The gains were capped due to month-end dollar demand from importers, mainly oil firms
The HSBC Emerging Markets Index, a monthly indicator derived from the PMI surveys, inched up to 50.4 in April, from 50.3 in March, signalling only a marginal increase in output across global emerging markets in April.
Risk sentiment is likely to be favourable if oil prices stay benign, global growth sentiment remains robust and the dollar index does not break out, says B Prasanna.
The HSBC Emerging Markets Index, a monthly indicator derived from the PMI surveys, sank to 50.6 in June from 51.3 in May, signalling the weakest increase in output since May, 2009.
It is the rupee's biggest single-day gain this year.
The NSE Nifty also moved up by 12 points to 8,648.35.
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.
The index went below the crucial 50 mark.
The 30-share Sensex ended down 414 points at 25,481 and the 50-share Nifty slipped 119 points at 7,603.
The HSBC/Markit purchasing managers index for the services industry inched up to 47.1 in October from 44.6 in September, the fourth successive monthly contraction of service sector output across India.
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.
Markets will remain closed on Thursday, 12 November 2015 on account of Diwali Balipratipada.
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 broader NSE Nifty closed below the 10,600 mark by plunging 98.15 points, or 0.84 per cent, to 11,582.35 after shuttling between 11,567.40 and 11,751.80.
Standard Chartered on Friday lowered India's growth forecast for the current financial year to 4.7 per cent from earlier 5.5 per cent, citing "upside risks" to inflation and fiscal deficit.
China's domestic debt is a major concern.
The world economy's growth engine is slowing, but not collapsing.
A Reuters poll had forecast retail inflation would slow to 8.35 percent from an annual 8.79 percent in January.
The 30-share S&P BSE Sensex ended up 130 points at 25,400 and the Nifty50 rose 46 points to close at 7,759.
Out of 30 Sensex shares, 19 ended lower while 11 gained