Share markets in India are presently trading marginally lower. Sectoral indices are trading on a mixed note with stocks in the energy sector and banking sector witnessing maximum selling pressure.

The BSE Sensex is trading down by 135 points (down 0.4%), while the NSE Nifty is trading down by 55 points (down 0.5%). The BSE Mid Cap index is trading down by 0.2%, while the BSE Small Cap index is trading down by 0.1%.

The rupee is trading at 67.86 to the US$.

In the news from the macroeconomic space, as the Congress and allies chipped away at the BJP seats in Karnataka elections yesterday, all eyes are now on Governor Vajubhai Vala.

The Governor will have to decide whether to call BJP to try to form the government or go with the JD(S)-Congress combine, which together have a clear majority in the 224-member Assembly.

There are high stakes involved as the final outcome will have a bearing on the stock markets too.

In the news from the banking sector, Punjab National Bank (PNB) share price is witnessing selling pressure today as the state-run lender reported loss of Rs 134 billion for the quarter ended March 2018. This was the biggest loss ever reported by any domestic lender.

The surge in net loss was seen on the back of surging bad loans. With regards to a provision made for the loss incurred on account of Nirav Modi fraud case, the bank said it provided for Rs 71.8 billion in the fourth quarter. This is 50% of the total amount of Rs 143 billion and the remaining amount will be covered in the three quarters of the current fiscal year.

Note that the massive fraud at Punjab National Bank in conjunction with the diamond merchant Nirav Modi, has put the spotlight on the growing bad loan problems in Indian banks.

It has brought to the fore the painful issue of willful defaulters, especially after the Vijay Mallya fiasco. The chart below shows the banks that have the highest number of willful defaulters.