Sensex Ends 363 Points Lower; Auto And Metal Stocks Witness Selling

Share markets in India continued to witness selling pressure during closing hours and ended their trading session deep in the red. All sectoral indices ended in the red with stocks in the metal sector and auto sector witnessing most of the selling pressure.

At the closing bell, the BSE Sensex stood lower by 363 points (down 1%) and the NSE Nifty closed down by 118 points (down 1.1%). The BSE Mid Cap index ended the day down 1.3%, while the BSE Small Cap index ended the day down 0.7%.

The rupee was trading at 70.03 against the US$.

Asian stock markets finished on a negative note. As of the most recent closing prices, the Hang Seng was down by 2.8% and the Shanghai Composite was down by 1.2%. The Nikkei 225 was down 0.3%.

In the news from the macroeconomic space, Indian manufacturing activity expanded at a slower pace in December. This was seen as growth in new orders and output waned, despite factories cutting their prices.

Going by the numbers, the Nikkei Manufacturing Purchasing Managers' Index, compiled by IHS Markit, declined to 53.2 in December, below November's 54.0 reading.

This, however, was above the 50 mark, which separates growth from contraction, for a 17th month. Also, manufacturing activity registered its strongest quarterly performance since late 2012.

December also saw the weakest increase in input costs for nearly three years, giving factories room to cut their prices for the first time since July 2017.Although new orders and output expanded at a slower rate last month, both remained well into expansion territory for more than a year, supported by weaker inflationary pressures.

Despite a strong performance in 2018, the survey indicated manufacturing firms were turning cautious. Hiring in December slowed as optimism waned amid uncertainty ahead of a national election scheduled for May.

It would be interesting to see how the manufacturing activity performance pans out in the coming months. Meanwhile, we will keep you updated on all the developments from this space.

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Disclosure: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. ...

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