Markets trade flat with negative bias in early noon session

In the extremely range-bound session of trade, Indian equity benchmarks altering between positive and negative territory, were trading flat with bit of negative bias on selling by investors in select stocks tracking losses in global markets amid fears of a possible hike in US interest rates. Further, investors remained cautious ahead of the May F&O expiry due on Thursday. Sentiment was weighed down with weakness in the Asian markets coupled with depreciation in the Indian Rupee against dollar. Sentiment remained down-beat with SBI report stating that credit growth in the country is unlikely to revive 'materially' in near term as demand conditions are still acting as a laggard. The yearly SBI Composite Index for May this year declined to 51.6, mainly due to lower credit growth. The monthly index, however, jumped to 50.3 in May from 46.5 in April due to increase in commercial vehicle and consumer durables sales. On the global front, Asian markets were trading lower, led by decline in Japan and China, as investors await further cues from next month's U.S. Federal Reserve monetary policy meeting. Back home, in scrip specific development, share of National Fertilizers was trading higher after the company reported a stand-alone net profit of Rs 31 crore in the fourth quarter of 2015-16.

The BSE Sensex is currently trading at 25218.23, down by 12.13 points or 0.05% after trading in a range of 25181.47 and 25274.21. There were 11 stocks advancing against 19 stocks declining on the index.

The broader indices were trading in red; the BSE Mid cap index was down by 0.58%, while Small cap index down by 0.74%.

The top gaining sectoral indices on the BSE were FMCG up by 0.17% and Consumer Durables up by 0.12%, while Realty down by 1.38%, Capital Goods down by 1.21%, Metal down by 0.96%, Oil & Gas down by 0.90% and TECK down by 0.79% were the losing indices on BSE.

The top gainers on the Sensex were NTPC up by 2.69%, Tata Motors up by 1.66%, ICICI Bank up by 0.97%, Reliance Industries up by 0.92% and ITC up by 0.69%. On the flip side, BHEL down by 1.69%, ONGC down by 1.37%, Sun Pharma down by 1.31%, Larsen & Toubro down by 1.31% and Adani Ports &Special down by 1.24% were the top losers.

Meanwhile, Reserve Bank of India (RBI) deputy governor SS Mundra has said that the RBI is examining the possibility of issuing regulatory directions on limiting the liability of customers on fraudulent transactions arising out of cards and electronic banking deals. Mundra said that ‘We are discussing this and once we finalise, the limit will be announced. We expect to finalise it very shortly and added that the idea is that the liability for the customer should not go beyond a point’.

Further, Mundra said that it is essential to have a robust mechanism in order to prevent incidents of frauds in mobile Net banking and the electronic fund transfer so as to retain customers' confidence in these delivery channels.  At present, a customer’s liability in the event of any unauthorised transaction is the lesser of actual loss at the time of notifying the bank, balance available for withdrawal, withdrawal limit set by the customer for a transaction or Rs10, 000.  Mundra pointed out that there has been increasingly large number of cases of mis-selling of third party products to customers by banks, particularly insurance products, including bundling of third-party products with loans. He warned that 'RBI is seized of this issue and may take a strict action, including heavy penalties, if the banking industry continues to follow such unethical and unaccepted practices of mis-selling of third-party products'.

He advised banks to put in place a system of periodic inspections of the sale of third-party products by either own staffs or by direct selling agents (DSAs). Furthermore, he said that with the increase in online transactions, there has been a rise in complaints related to electronic banking transactions, unauthorised fund transfers, fraudulent withdrawals from ATMs using duplicate cards and phising e-mails, among others.

Emphasizing customer awareness for safe usage of these channels should be an important item on the agenda of the bank, the deputy governor said that if customers don't get confidence in the channels and decide to withdraw from them, then it can have only two outcome - either customer would migrate or customer would come back to the traditional channel which would mean higher operating cost for the banking system.

The CNX Nifty is currently trading at 7724.00, down by 7.05 points or 0.09% after trading in a range of 7715.80 and 7744.80. There were 20 stocks advancing against 30 stocks declining on the index.

The top gainers on Nifty were NTPC up by 2.73%, Tata Motors up by 1.91%, Tata Power up by 1.42%, Reliance Industries up by 0.97% and ICICI Bank up by 0.95%. On the flip side, Hindalco down by 2.99%, Aurobindo Pharma down by 2.72%, Idea Cellular down by 2.40%, Bank of Baroda down by 2.20% and BPCL down by 2.17% were the top losers.

Asian markets were trading lower; Nikkei 225 decreased 155.84 points or 0.94% to 16,498.76, Hang Seng decreased 67.62 points or 0.34% to 19,741.41, Taiwan Weighted decreased 43.78 points or 0.52% to 8,300.66, Shanghai Composite decreased 31.4 points or 1.1% to 2,812.24, KOSPI Index decreased 17.57 points or 0.9% to 1,937.68, Jakarta Composite decreased 13.98 points or 0.29% to 4,729.68 and FTSE Bursa Malaysia KLCI decreased 4.43 points or 0.27% to 1,630.46.