Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

India’s Manufacturing PMI dipped to a three-month low of 56.3 as COVID-19 fears hurt business sentiments in November. IHS Markit’s India Manufacturing Purchasing Managers’ Index (PMI) had hit a decades high in October amid strong expansion of manufacturing activities. Marginal increase in new orders, exports and demand reduced output in November compared to October. 


The headline figure of 56.3 indicates marked improved in business conditions led by consumer goods sector which reported strong growth. Fear around the imposition of lockdowns amid surge in COVID-19 cases, Rupee depreciation and uncertainty around government policies dampened business sentiments and also caused a further dip in payroll numbers in November, according to the Markit report. 


Following robust growth in October, manufacturers expected strong demand and increased additional raw material purchases to ramp-up production processes. Input costs for most manufacturers’ rose in November resulting in an increase in output charges or price hikes. The increase in purchases volumes were, however, slowest pace in the last three-months. Manufacturers reported increase in input holdings amid a decline in finished good inventories.


India’s core sectors output up by 2.5pc

India’s eight core industry output index for October stood at 124.2, down 2.5pc from the prior year, according to provisional official data.  

This is the eighth consecutive monthly contraction, fueled by lower production of petroleum products and steel. The index had contracted marginally by 0.1pc in September. For the April-October period, the index reported a de-growth of 13pc from the prior period.


In October, crude oil, natural gas and refinery products declined by 6.2pc, 8.6pc and  17pc, respectively from the prior year. 


Steel sector’s output declined by 2.7pc in October, while for the April-October, de-growth was 22.8pc from the prior year. While coal production rose by 11.6pc in October from the prior year, for the April-October period coal sector dipped by 3.6pc.


Other sectors which improved in October are cement up by 2.8pc from the prior year, fertilizer production up by 6.3pc and electricity generation up by 10.5pc. 

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