The US markets made a soft start of December and the major indices lost about half a percent on Monday on getting weaker-than-expected manufacturing report. Though there was some counter-offer from House of Republicans to avert the "fiscal cliff " but it was of no help. Institute of supply management reported that US manufacturing unexpectedly contracted to 49.5 in November from 51.7 in October, to the lowest level in nearly three years. A reading below 50 indicates a contraction in manufacturing activity. However, a separate report from the Commerce Department showing a bigger than expected increase in US construction spending in October helped to limit the downside for the markets.
On fiscal cliff issue, in a letter to President Obama, House Speaker John Boehner and six other House Republican leaders called for $800 billion in revenues through tax reforms and $600 billion in health savings among other offers. Net savings under the counter-offer would total $2.2 trillion.
In Europe, there was some positive news as Spain formally requested EU bank aid and Greece offered to buy back as much as 10 billion Euros of its debt. German Chancellor Angela Merkel said that Germany may ultimately write-off Greek debt, but not before 2015.
The Dow Jones Industrial Average lost 59.98 points, or 0.46 percent, to close at 12,965.60, the S&P 500 declined by 6.72 points, or 0.47 percent, to finish at 1,409.46, while the Nasdaq slid 8.04 points, or 0.27 percent, to end at 3,002.20.
Indian ADRs closed mostly in red on Monday, HDFC Bank was down by 0.41%, Wipro was down by 0.08%, Infosys was down by 0.45% and MTNL was down by 0.03%. On the other hand ICICI Bank was up by 0.15% and Tata Motors was up by 0.01%.
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