Bank Stocks Outlook for the week – 22 to 26.02.2016
( www.rupeedesk.in )
Stocks
of banks are seen trading positive next week, with investors
focusing
on the upcoming 2016-17 (Apr-Mar) Union Budget. This week,
public
sector banks gained on hopes that the government will infuse
higher-than-anticipated
capital to clear their stressed asset books.
State-owned
lenders' already-battered balance sheets took a further
beating
in Oct-Dec following the Reserve Bank of India's asset quality
review,
which led to 11 public sector banks reporting losses for the said
quarter
after the central bank advised lenders to provide for accounts
which
may not be non-performing on their books, but have turned bad for
other
banks.
The
process, termed "deep surgery" by RBI Governor Raghuram Rajan as
opposed
to temporary relief measures, comes as Indian banks have been
set
a deadline of March 2017 to clean up and have fully provisioned
balance
sheets. Value buying by FII (foreign institutional investors) has
lifted
the market sentiments the range of 7100-7300 levels (for Nifty 50)
will
remain crucial in the current expiry.
The
coming week, market is likely to trade with positive biases and dips
should
be used to initiate fresh buy position. Banking, infra and auto
sectors are likely to remain in action ahead of the union budget.