The US markets closed lower on Thursday, the first trading day of 2014 after data pointed to a slowdown in manufacturing expansion in China. This is the first time markets started the year on a down note since 2008. On the economy front, the number of Americans applying for unemployment benefits fell slightly in the last week of 2013, suggesting that the US labor market remains on a path of gradual improvement. The Labor Department stated that in the seven days ended December 28, initial jobless claims dropped by 2,000 to 339,000, the lowest level in four weeks. One year ago, claims stood at 372,000. The average of new claims over the past month, usually a more reliable gauge than the weekly number, rose by 8,500 to 357,000. That’s the highest level since late October, but the increase likely reflects a temporary holiday-season spike that will fade over the next few weeks. American manufacturing companies ended 2013 with the biggest increase in new orders in more than 2 1/2 years, underscoring the economy’s momentum heading into the New Year. The Institute for Supply Management’s manufacturing index registered 57.0% in December, down slightly from a 2 1/2-year high of 57.3% in November.
Besides, a gauge of US manufacturing hit an 11-month high in December, up from a preliminary monthly estimate, signaling a pick up in activity. December’s reading for the manufacturing purchasing managers’ index hit 55, up from a prior estimate of 54.4 and November’s level of 54.7. Separately, outlays for US construction projects rose 1% in November, led by private projects. Spending on residential construction rose 1.7% in November, while nonresidential construction spending increased 0.6%. Total private construction spending rose 2.2%, while public spending fell 1.8%.
The Dow Jones Industrial Average lost 135.31 points or 0.82 percent to 16,441.35, the S&P 500 was down 16.38 points or 0.89 percent to 1,831.98, while Nasdaq dropped 33.52 points or 0.80 percent to 4,143.07.
Indian ADRs closed in red on Thursday; Tata Motors was down 1.23%, ICICI Bank was down 1.17%, Infosys was down 1.07%, Dr. Reddy’s Lab was down 0.73% and HDFC Bank was down by 0.66%.
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