Banking stocks skyrocketed on June 3, with Bank of Baroda, SBI, PNB, Axis Bank, ICICI Bank, and Kotak Bank rising up to 12%. The Bank Nifty index also crossed 50,000 for the first time, driven by optimism over a likely BJP-led NDA victory in the 2024 elections.
Key Highlights:
- Record Highs: Banks like BoB, SBI, Axis Bank, ICICI Bank, Indian Bank, and Canara Bank hit fresh 52-week highs.
- Stock Performance: These stocks have surged between 10-46% this year, compared to a 5% rise in the Bank Nifty index.
Analyst Insights:
- Morgan Stanley: Remains bullish on financials like SBI, BoB, ICICI Bank, LIC Housing Finance, Shriram Finance, HDFC AMC, ICICI Prudential, and ICICI Lombard.
- Jefferies: Positive on private banks such as HDFC Bank, IndusInd Bank, and Kotak Mahindra Bank due to attractive valuations.
Economic Outlook:
- S&P Global Ratings: Upgraded its outlook for six Indian banks, including SBI and HDFC Bank, to ‘positive’ from ‘stable’ due to strong economic growth.
- Technical Analysis: Bank Nifty could reach 51,000-52,000 levels but may find support at 47,000 and 46,200 if it drops below 48,000.
Election Impact:
Exit polls suggest the NDA could win 370 seats, with BJP alone securing over 325 seats, up from 303 in 2019. BJP’s vote share may rise to 40%, and NDA’s to 47%, compared to 37.3% and 45% in 2019, respectively.
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