D Street at a New High; All Eyes on RBI
Manufacturing takes a hit and sales of durables slump, but car cos make record despatches to dealers
Kolkata | New Delhi: Manufacturing took a hit in July, due largely to the rollout of GST at the beginning of the month, plummeting to its lowest in more than eight years. Also, sales of durables slumped, taking the industry by surprise. On the other hand, car sales grew at near-record levels. The Monetary Policy Com- mittee will take on board all this and other data ahead of what’s widely expected to result in a decision on Wednesday to cut interest rates, according to an ET poll.
The Nikkei India Manufacturing Purchasing Manager’s Index (PMI) slowed to 47.9 in July, its lowest since February 2009, compared with 50.9 in June. A reading above 50 indicates expansion. New orders and output fell the steepest in more than eight years.
“Manufacturing growth in India came to a halt in July, with the PMI down to its lowest mark in almost eight-and-a-half years amid widespread reports that the sector has been adversely affected by the implementation of GST,” said Pollyanna De Lima, economist at IHS Markit and author of the report. Setting new records for the second day, the Sensex on Tuesday closed at 32,575 and the Nifty at 10,115 as investors wait for the outcome of RBI policy meet amid corporate earnings momentum.