Indian markets slip into red

Fri, 3 Jan Closing

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Persistent selling pressures followed by lower volumes led the Indian markets to fall sharply into the red today. Sectors such as Power, Capital goods, Auto and Oil and Gas have observed maximum selling pressures today. That said, the BSE Mid Cap and BSE Small Cap were seen in favor today and the respective indices stood higher by 0.63% and 0.60% respectively. The BSE Sensex closed lower by 37 points and the NSE-Nifty was seen down by 10 points.

On the global front, most of the Asian indices closed the day on a negative note and the European indices have opened on a mixed note. The rupee was trading at Rs 62.31 to the dollar at the time of writing.

Most of the Energy stocks have closed the day in red with Gujarat Gas and BPCL leading the pack of losers for the day. Whereas Chennai Petroleum and Oil India Ltd lead the pack of gainers today.

As per leading financial news daily, Reliance Industries is set to raise its gas output at KG-D6 fields. The company will add about 1-3 million standard cubic meters per day of gas production at its eastern offshore fields. This will reverse the trend of falling output. Reliance Industries and its partners have spud the seventh well on the MA oil and gas field in the KG-DWN-98/3 or KG-D6 block in Krishna Godavari basin. The well MA-8 is projected to produce a minimum of 1 mmscmd and a maximum of 3 mmscmd. At 3 mmscmd, MA-8 will be the company's biggest gas producer well on KG-D6 currently. The production at KG-D6 block has dropped to 12 mmscmd and MA-8 will help reverse the falling trend of last three years. The company is also said to have been repairing a third of the wells shut at its main D1 and D3 gas field to boost output by March this fiscal. The stock was down by 1.13%.

Most of the stocks from the PSU banking space were seen in favor today with Bank of Maharashtra and UCO bank leading the pack of gainers whereas Indian Bank and Oriental Bank of Commerce leading the pack of losers.

As per leading financial news daily, The Reserve Bank of India (RBI) gives a green signal to the lenders to charge reasonable fee on ATM transactions. The Deputy Governor is of the opinion that the transaction fee on ATM services is best to be left at the discretion of the lenders to decide their own offerings. Currently, the bank incurs Rs 15 plus taxes for every transaction to other bank even for the free transactions. As a result, the banks have been making losses and hence would prefer to raise charges.

While the fee-income component forms larger portion of the non-interest income of a bank, raising charges on ATM transactions would provide further boost to the income performance of the bank. Therefore, this move from the Central Bank would make the ATM transaction model further viable and bring respite especially to lenders that have reported losses on the non-interest income side.