The Indian stock market is trading in the green on May 21 after a two-day losing streak led by broad-based buying across key sectors.
Sensex is up 696.51 points or 1.41 percent at 50261.37, and the Nifty jumped 198.10 points or 1.33 percent at 15104.10. Broader markets were also higher intraday with the midcap and smallcap indices up a percent each.
Among sectors, banks and financial led the rally with Bank Nifty adding over 2 percent. Among banking names, IndusInd Bank gained over 3 percent followed by HDFC Bank and ICICI Bank which were up 2 percent each.
Axis Bank, Federal Bank, Bandhan Bank and RBL Bank were the other top performers.
Among the PSU banking names, share price of State Bank of India was up over a percent ahead of its March quarter results. India’s largest lender will report its quarterly earnings for the March quarter today.
The bank is expected to report an over 100 year-on-year growth in standalone profit for the March 2021 quarter, driven by a decline in provisions, healthy net interest income & pre-provision operating profit. Brokerages expect the low base of the previous fiscal to also support numbers in Q4.
Axis Securities has SBI as one of its top picks. It recommends buying the stock for a target price of Rs 477 per share.
The stock price has already zoomed 100 percent in the last 9 months and is expected to move even higher.
It was also the most active stock on NSE in terms of value with 2,98,42,195 shares being traded followed by IndusInd Bank, HDFC Bank and Bajaj Finance while PNB along with YES Bank and Bank of Baroda were the most active stocks in terms of volumes.
Share price of Indian Bank (up 4 percent) followed by Canara Bank, Bank of Baroda, Bank of India, Punjab National Bank and Union Bank of India were the other gainers.
Nifty Financial Services was up 2 percent intraday with HDFC up 2 percent followed by Indiabulls Housing Finance, PFC, REC and Shriram Transport Finance.
268 stocks have hit new 52-week high on BSE including names like HFCL, JK Lakshmi Cement, HPCL, Adani Gas, Pidilite Industries and Firstsource Solutions among others.
According to V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the rally in PSU banks is a value trade. The weakness in the banking segment may be used to buy the private sector leaders whose long-term prospects are extremely bright.
“When the economic cycle turns decisively, credit growth will pick up smartly. The large well-capitalized private sector banks are uniquely placed to benefit from this emerging trend,” he said.
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