Benchmarks continue their southward journey in late morning

After a weak start, Indian equity benchmarks continued their southward journey in late morning deals, following weakness in Asian markets and subdued sentiment as Ukraine concerns resurfaced. Sentiments got dampened as the rupee depreciated against the US dollar. Investors remained cautious ahead of Wholesale Price Index-based (WPI-based) inflation numbers for February, to be released later in the day.

On the global front, the Asian markets too were trading in the red at this point of time as Chinese economic data missed estimates while Ukraine crisis overshadowed signs of improvement in the US economy. Back home, traders were buying, Healthcare while selling was seen in Bankex, Capital Goods and Realty.

The market breadth on BSE remains negative with advances to declines in the ratio of 715:1260. BSE Sensex and NSE Nifty were comfortably trading near their psychological 21,600 and 6,400 levels respectively. The BSE Sensex is currently trading at 21622.68 down by 151.93 points or 0.70% after trading in a range of 21714.44 and 21614.00. There were 7 stocks advancing against 23 declines on the index. The broader indices were trading in red; the BSE Mid cap index was down by 0.66% and Small cap index  down by 0.44%.

The gaining sectoral indices on the BSE were, Healthcare up by 0.26%, while Bankex down by 1.84%, Capital Goods down by 1.23%, Realty down by 1.04%, Power down by 0.88% and Metal down by 0.72% were the top losers on the sectoral index.

The top gainers on the Sensex were Gail India up by 1.35%, Dr Reddys Lab up by 1.13%, Infosys up by 0.49%, Bajaj Auto up by 0.49% and ONGC up by 0.34%. On the flip side, Axis Bank was down by 2.40%, Bharti Airtel was down by 2.04%, ICICI Bank was down by 1.87%, Bhel was down by 1.67% and SSLT was down by 1.62% were the top losers on the Sensex.

Meanwhile, In order to meet expenses for its regulatory and investor-centric activities, Market regulator SEBI will soon consider a significant revision in the fees it charges from various entities. However, a final decision on the proposed revision, which includes pushing back the fees to the level seen before a reduction took place in 2009 for some intermediaries, would be taken by SEBI's board at a meeting scheduled for later this month.

The proposal to revise the fee structure is based on recommendations made by a Committee on Rationalization of Financial Resources (CRFR), which has submitted its report to market watchdog after detailed discussions and a 'thorough study' of various parameters. Further, it comes against the backdrop of lower volumes in primary as well as secondary markets, resulting in reduced fee collections.

As per the recommendations, the application fee for mutual funds can be hiked to Rs 5 lakh from the existing Rs 1 lakh, while registration fee is expected to remain steady at the current level of Rs 25 lakh. Besides, the panel has recommended that regulatory fee for stock exchanges having turnover in excess of Rs 10 lakh crore at Rs 1 crore plus 0.00006 per cent on turnover in excess of Rs 10 lakh crore. The overall regulatory fee would be capped at Rs 20 crore. For stock brokers, the proposal is to restore 2006 fee structure level -- charging a fee of Rs 20 per one crore of turnover.

As per SEBI’s estimates, the regulator's operational income (fees from intermediaries) is expected to be about Rs 165 crore in the current fiscal - ending March 31, 2014 and at about Rs 196 crore in the next financial year 2014-15. However, a revision in fee structure as per CRFR recommendations can boost SEBI's operational income to Rs 378 crore in 2014-15. Presently, SEBI is expected to post a deficit of Rs 66 crore on operational account in 2013-14, while the gap can further increase to about Rs 85 crore in next fiscal. However, a revision in fees can help SEBI post a surplus of about Rs 98 crore in the next fiscal 2014-15.

Further, total income for the year 2014-15 is estimated at Rs 372 crore, which would include Rs 196 crore as fees from intermediaries, Rs 158 crore as income from investments and about s 18 crore as miscellaneous income. However, after adoption of CRFR suggestions, the total estimated income can shore upto to Rs 554 crore, on account of an increase in fee income.

The CNX Nifty is currently trading at 6,441.65 down by 51.45 points or 0.79% after trading in a range of 6,472.95 and 6,437.40. There were 8 stocks advancing against 42 declines on the index.

The top gainers of the Nifty were Dr. Reddy's Laboratories up by 1.39%, Gail up by 1.27%, Bajaj-Auto up by 0.57%, ONGC up by 0.56% and Infosys up by 0.52%. On the flip side, Kotak Bank down by 3.83%, IDFC down by 3.37%, HCL Tech down by 2.73%, Axis Bank down by 2.66% and Indusind Bank down by 2.29% were the top losers on the index.

The Asian equity indices were trading in red; Shanghai Composite declined by 11.06  points or 0.55% to 2,008.36, Hang Seng tumbled by 282.58  points or 1.30% to 21,473.50, Jakarta Composite dipped 35.64 points or 0.75% to 4,690.52, KLSE Composite contracted by 7.67 points or 0.42% to 1,811.19, Nikkei 225 shed by 403.05 points or 2.72% to 14,412.93, Straits Times decreased by 13.26 points or 0.43% to 3,068.13, KOSPI Composite slipped 10.96 points or 0.57% to 1,923.42 and Taiwan Weighted was down by 56.79 points or 0.59% to 8,695.75.