After opening the day in green, share markets in India witnessed negative trading activity at in the final hours of the trading session and ended the day in the red. Sectoral indices traded mixed, with stocks in the realty sector and stocks in the FMCG sector, leading the losses.
At the closing bell, the BSE Sensex stood lower by 332 points (down 0.9%) and the NSE Nifty closed down by 98 points (down 0.8%). The BSE Mid Cap index ended the day down 0.5%, while the BSE Small Cap index ended the day down 0.2%.
The rupee was trading at Rs 71.08 against the US$ in the afternoon session. Oil prices were trading at US$ 78.12 at the time of writing.
Asian stock markets finished in red. As of the most recent closing prices, the Hang Seng was down by 0.6% and the Shanghai Composite was down by 0.2%. The Nikkei 225 was down by 0.8%. Meanwhile, European markets too were trading on a negative note. The FTSE 100 was up by 0.7%. The DAX, was down by 0.2% while the CAC 40 was down by 0.1%
In news from the manufacturing sector. Activity in India's manufacturing sector slowed down as domestic orders went down.
According to the Nikkei Purchasing Managers' Index (PMI) survey by Markit, India's manufacturing sector slowed down its pace of expansion in August similar slowdown in July.
The PMI is the reading of the country's manufacturing sector output and is updated monthly. A reading above 50 indicates expansion, while any score below the mark denotes contraction.
PMI in August stood at 51.7 a decrease from the 52.3 reading in July, indicating a slowdown in growth. However, this is the fourteenth consecutive month that the manufacturing PMI remained above the 50-point mark, which separates expansion from contraction. Notably, the PMI reading in June had expanded at its fastest pace in the last seven months.
Manufacturing Activity Eases Pace in August
A surge in oil prices over the past few months means India's retail inflation has remained above the Reserve Bank of India's (RBI) medium-term target of 4% prompting the central bank to raise key interest rates by 25 bps in its latest monetary policy review.
On the prices front, a build-up of inflationary pressures re-emerged as input cost and output inflation was at the strongest since February due to the upswing in global oil prices.
Though Indian manufacturers remained cheerful about growth prospects, worries about the possibility of unexpected policy decisions and a risk of an international trade war weighed on confidence.
Moving on to news from stocks in the FMCG sector. Godrej Consumer share price was in focus today after it was reported that the company divested its United Kingdom (UK) business.
The company divested its entire stake in its UK business, Godrej Consumer Products UK, to JZ International, a leading pan-European private investment business based in London, effective immediately.
This is in line with the company's long-term objective of continually optimizing its portfolio and making the appropriate capital allocation.
The divestment of what was GCPL's first global acquisition back in 2005
Godrej consumer sold the business for a consideration of about US$ 44 million.
Godrej Consumer share price ended the day down by 1.1%.
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