Bankex, metal index among five indices at 52-week low

Written by Markets Bureau | Mumbai | Updated: Nov 22 2011, 09:01am hrs
Bankex, the banking index of The Bombay Stock Exchange (BSE), ended the day at 9,831.83 points, its lowest since February 2010. The Banking sector index has been under pressure following slowdown in the economy which might result in slower credit growth and spike bad loan figures. Apart from Banking index, other index such as Metal, Realty, Power and PSU touched 52-week low on an intra day basis on the bourses on Monday.

Bankex and Metal index were one the worst performers of the day among the BSE sectoral indices falling by 3.2% and 3.4% respectively on Monday.

Manasije Mishra, MD & CEO, HSBC Invest Direct Securities (India) says, Slowdown in the overall economy is leading to the volatility in the domestic markets. In the last few weeks we have seen some uncertainty in the banking index following some issues on the credit quality of few banks following higher bad debts. However, though volatility will continue in the banking sectors for some more time, some stocks currently in the private sector are looking attractive, he added.

On Monday, all the 14 stocks in the Bankex index ended the day in red with ICICI Bank and State Bank of India (SBI) being among the worst performers of the day. While other sectors like Realty remains under pressure following high interest rates scenario, shortage of coal supply has hit the power companies in the last few months.

BSE Realty index ended the day at 1,558.23 down by 3.04%, while BSE Power index witnessed a fall of 2.7% and closed the day at 1,912.86.

Mishra Further added that, Concerns on the realty side are likely to continue as we are some time away from a shift in the interest rate cycle. We believe that markets are likely to remain range-bound in the months to come.

Market participants also added that, markets will be looking at some reforms from the government side which might bring some stability in overall economy. Since last few months no major policy reforms has been taken by the government and there has been slowdown in the growth also. We desperately need some strong measures on the infrastructure side as its a major roadblock to achieve 8-9% growth of the country, said a fund manager on condition of anonymity. PSU index ended marginally down by 2.3% at 6,676.37 points.