SBI, other PSU bank shares sell-off to pull Bank Nifty under 31,000 mark; Experts slap 'sell on rise' on Bank Nifty future

Profit-booking is widely expected over the next few days in Public Sector Undertaking (PSU) banks' shares like SBI and their private rivals too. The impact on Bank Nifty is expected to be bad enough to make it fall below 31,000 mark. According to the stock market experts, the selloff heat that set to be generated by FIIs and DIIs, Bank Nifty index is expected to hit 30,600 to 30,700 levels. They are of the opinion that investors should not enter Bank Nifty till it is in the range of 30,100 to 30,250 and then try to adopt 'sell on every rally' strategy.

Speaking on Bank Nifty outlook, Prakash Pandey, MD & CEO at Plutus Advisors said, "Public Sector banks, especially SBI is expecting profit-booking as it has been rallying for the last one month and scaled from Rs 290 odd levels to around Rs 345 per stock levels. So, there can be some profit-booking in the large-cap stock as both FIIs and DIIs have gone silent in the current stock market scenario. FIIs and DIIs will make their stand clear only after the two triggers — outcome from the US Fed meeting today and the US-China trade talks scheduled on 15th December 2019." 

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Pandey said that FIIs may start selling their position in the banking stocks ahead of the US-China trade talk meeting and it may have a direct effect on major Indian indices like Sensex, Nifty and Bank Nifty. He said that Bank Nifty may tank up to 2 per cent by Friday weekend and may hit 30,600 to 30,700 levels on the downside.

Commenting on shares that will pull down Bank Nifty, Simi Bhaumik, a SEBI registered technical stock expert said, "Bank Nifty is currently trading in the range of 31,100 to 31,400 and I would suggest share market investors adopt sell on rise strategy as the index looks weak for coming trade sessions. Bank Nifty index has strong support at 30,900 levels and if it breaks these levels and sustains below this level, then we can expect further 200-250 points correction in the Bank Nifty index." 

Asked about the banking stocks that will lead to a bloodbath in the Bank Nifty index, Bhaumik said that SBI and other public sector banks are highly bearish. She said that except ICICI Bank and Kotak Mahindra Bank, all banking shares will feel the heat of profit-booking in the coming few trade sessions.