Singapore's manufacturing sector contracted for the 6th straight month in December due to declining orders from overseas and local markets.

Singapore Institute of Purchasing & Materials Management (SIPMM) said the Purchasing Managers' Index (PMI) stood at 49.5 points, up from November's 48.7. A reading above 50 indicates that the manufacturing economy is generally expanding while a reading below 50 indicates a contraction.

Manufacturing in Singapore had expanded for 9 consecutive months before July, when the reading slipped to 49.3.

In the electronics sector, the index declined 1.2 points from the previous month to 49.7 in December.

Employment in the electronics sector also continued to contract for the second straight month to 49.1.

According to SIPMM, key indicators recorded weak readings due to the negative global business sentiment, given the euro debt crisis and the slowing China economy

The PMI reflects anticipated factory orders, based on interviews with purchasing managers at more than 150 industrial companies here.