Bank Stocks Outlook for the week – 26 to 30.12.2016
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Amid lack of fresh sector-specific cues, bank stocks are expected to move in tandem with the trend in the broader market next week. The bias, however, is seen negative due to continuous selling by foreign institutional investors. Heavy selling by foreign institutional investors this week, which hit banking stocks, is expected to continue next week as well. We believe any further decline in the Nifty will be triggered by the banking space. Activity in the broader markets is seen range-bound due to lack of major triggers, as well as holidays globally. The Nifty Bank index is expected to find support at 17500-17000, while resistance is seen at 18700-18300. The banking index, which closed down 2.3% on week, is likely to record volatility due to rollovers amid the expiry of the December contract next week. We feel 18200 is likely to act as a stiff hurdle for December expiry. The bounce in the index should be utilised to create short positions. Market participants are awaiting fresh triggers from the announcement of corporate earnings for the December quarter, which begin on Jan 7. Among individual stocks, Union bank of India and Canara Bank are likely to be in focus, as new short positions were taken in these stocks.
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Bank Stocks Outlook for the week – 26 to 30.12.2016
Amid lack of fresh sector-specific cues, bank stocks are expected to move in tandem with the trend in the broader market next week. The bias, however, is seen negative due to continuous selling by foreign institutional investors. Heavy selling by foreign institutional investors this week, which hit banking stocks, is expected to continue next week as well. We believe any further decline in the Nifty will be triggered by the banking space. Activity in the broader markets is seen range-bound due to lack of major triggers, as well as holidays globally. The Nifty Bank index is expected to find support at 17500-17000, while resistance is seen at 18700-18300. The banking index, which closed down 2.3% on week, is likely to record volatility due to rollovers amid the expiry of the December contract next week. We feel 18200 is likely to act as a stiff hurdle for December expiry. The bounce in the index should be utilised to create short positions. Market participants are awaiting fresh triggers from the announcement of corporate earnings for the December quarter, which begin on Jan 7. Among individual stocks, Union bank of India and Canara Bank are likely to be in focus, as new short positions were taken in these stocks.
