The Hindu : Business : Bank stocks to the fore again

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Friday, Sep 29, 2006
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Bank stocks to the fore again

MUMBAI: Banking stocks outperformed for the third consecutive day on the back of a spate of positive developments for the sector, aiding the benchmark Sensex to end moderately up by 14 points while investors rolled over positions to October series.

Reflecting the unprecedented rally, the bankex zoomed by 217.58 points or 3.70 per cent to close at an all-time of 6094.47 from the previous close of 5876.89. The bankex soared by 407.35 points or 7.16 per cent in three days.

The Bombay Stock Exchange 30-share sensitive index moved in a range of 12431.79 and 12340.17 in a choppy trade before ending the day of 1,380.74, a net rise of 13.83 points over Wednesday's close of 12366.91.

However, the National Stock Exchange's (NSE) S&P CNX Nifty fell back by 7.55 points or 0.21 per cent to end at 3571.75 from the previous close of 3579.30. Banking shares drew significant support from favourable interest rate outlook and likely implementation of Basel II, which is a positive factor the sector, brokers said. Global factors including a pause in interest rate hikes by Federal Reserve in the last two meetings too contributed to a surge in bank stocks in the past few weeks, they added.

Unlike a rush for bank shares during the day, investors generally were engaged in rolling over positions to October contract of derivatives, which begins on Friday. The mid-cap and the small-cap stocks attracted fairly good activity as retailers shifted their attention to these segments. — PTI

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