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  1. What drove Bank Nifty to highest closing in 2016? Check this out

What drove Bank Nifty to highest closing in 2016? Check this out

Stocks of State Bank of India (SBI) and ICICI Bank zoomed more than 5.4% and 4.3%, respectively, on Tuesday, driving up the Sensex by 232 points.

By: | Mumbai | Published: June 8, 2016 7:11 AM

Stocks of State Bank of India (SBI) and ICICI Bank zoomed more than 5.4% and 4.3%, respectively, on Tuesday, driving up the Sensex by 232 points.

The Bank Nifty closed at 17,948 points, the highest in 2016. Key banking stocks, including those of Federal Bank, Punjab National Bank (PNB), Bank of Baroda and Indian Overseas Bank, were trading up between 0.7% and 5.4%. SBI, Federal Bank and ICICI Bank together contributed to nearly 70% of the index’s total surge of 1.6%.

Post the earnings reported by banks, domestic brokerage Kotak Institutional Equities in a recent report said growth remains similar to industry average for banks at 10-11% Y-o-Y. Public banks continue to report noticeable slowdown with growth at 4% Y-o-Y. The corporate segment is witnessing the maximum slowdown as there is some shift in lending to money market instruments owning to a sharp change in liquidity environment.

Largest tractor manufacturer, Mahindra & Mahindra, continued its three-day gaining streak and further rose 8.25 points, ending at R1,377.85 apiece. Auto bluechips Hero Motocorp and Bajaj Auto traded flat on Tuesday. Of the 14 stocks comprising the BSE Auto index, 11 ended up, gaining between 0.2% and 2.4%.

Realty stocks were also part of Tuesday’s rally, as the BSE Realty index closed at 1447.7 points, up by 1.7%. Real estate stocks such as IndiaBulls Real Estate, Godrej Properties and DLF managed to clock gains between 2% and 4%. Despite a steep fall in the initial two months, 2016 has given the realty index positive returns so far.

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