Sector Spotlight – Banking stocks were in focus today; analyst gives his top buy recommendations

Banking stocks were in focus today. Both private and public sector banks were trading with a positive bias throughout the day led by ICICI Bank which remained numero uno on the Nifty50 and Bank Nifty indices.  

Even as the 50-share Nifty50 ended at 18,125.40 up by 0.06 per cent of 10 points, Nifty Bank was the top gainer among sectoral indices. It was up over 2 per cent or 869 points and settled at 41,192. The 12-share index hit its life high of 41,829.60. Five stocks ended the day in the green while seven ended in the red as it shed some points towards the fag end of the trading session on Monday.  

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The top gainer was ICICI Bank, on the back of strong September quarter results declared on Saturday and which were better than the street’s estimates. The second largest private lender also hit its 52-week high of Rs 867. The share also traded with significant volumes. The stock ended at Rs 846.75 on the NSE, up by 11.5 per cent. It was followed by Axis Bank and Punjab National Bank (PNB) which ended up 3.5 per cent and 2.3 per cent respectively. 

Bandhan Bank, Federal Bank and Indus Bank were among top losers on Nifty Bank losing over 4 per cent, 1.8 per cent and 1.5 per cent respectively.  

Axis Bank and Kotak Mahindra Banks will be announcing their results on Tuesday. 

Nifty PSU Bank was up over 1 per cent at the closing time and ended at 2854.30. The biggest gainer was Indian Bank, up almost 3 per cent. It was followed by PNB and Bank of Baroda (BoB) which gained 1.8 per cent. The PSU Banks continue to put up a strong show. Eight out of 13 stocks in this index ended positively. Four stocks ended in the red and 1 remain unchanged. Union Bank, Central Bank and J&K Bank were the top losers.  

Nifty Private Bank ended at 21,426.90, up 2.3 per cent. 

Technical Analyst Nilesh Jain is bullish on certain banking stocks. He sees Nifty Private bank to test levels of 22,000 over a positional term basis. Jain, Assistant Vice President (AVP), Equity Research Technical and Derivatives at Centrum Broking recommends two stocks from the private banks’ segment.  

One is Axis Bank for a price target of Rs 920 and Rs 950 with a 1-month veiw. The stop loss is at Rs 820. It ended at Rs 845, up 3.5 per cent. The stock today hit its 52-week high of Rs 866.90. 

Another stock picked by him was RBL Bank for a price target of Rs 220 and a stop loss at rs 195. An upside will open after levels around Rs 208 is breached which is a crucial breakout level. 

He also recommended State Bank of India (SBI) for the price target of Rs 550. The stock ended at Rs 507.10 after hitting its 52-week high 515.45 on the intraday basis. Buy at existing levels or on dips is advised by Jain. He puts the stop loss at Rs 480. 

He also recommends Hold on PNB and BoB shares for targets of Rs 50 and Rs 110. The stop losses are Rs 44 and Rs 87 respectively. 

(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)