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Bank stocks are seen trading with a negative bias as the overall outlook for the sector remains bearish. Rollovers of positions to the February series in the backdrop of expiry of January contract Thursday indicates significant build-up of short positions. SBI, Kotak Mahindra Bank, and Bank of Baroda are starting the new series with significantly higher open interest indicating prevailing short bias among these stocks. Action would remain stock specific with some banks reporting their results. Stocks of Vijaya Bank, State Bank of Bikaner and Jaipur, Bank of Baroda, Central Bank of India, Corporation Bank, and Andhra Bank would be in focus as these banks release their Oct-Dec earnings.
SBIN (State Bank of India) has added significant amount of short positions and rollovers have also have been very strong. After tepid QIP (qualified institutional placement) response, hike in interest rate stock has been under pressure. Comments from finance ministry officials on retail loan-linked capital infusion in state-owned banks would also be keenly watched. Earlier this week, Cogencis reported that the finance ministry has asked state-owned banks to give details of their credit growth during the festive season by Jan 31 to check their eligibility for additional capital infusion. The government, which has already infused 140 bln rupees in public sector banks, has promised further capital infusion after ascertaining their retail lending performance between October and January.
Bank stocks are seen trading with a negative bias as the overall outlook for the sector remains bearish. Rollovers of positions to the February series in the backdrop of expiry of January contract Thursday indicates significant build-up of short positions. SBI, Kotak Mahindra Bank, and Bank of Baroda are starting the new series with significantly higher open interest indicating prevailing short bias among these stocks. Action would remain stock specific with some banks reporting their results. Stocks of Vijaya Bank, State Bank of Bikaner and Jaipur, Bank of Baroda, Central Bank of India, Corporation Bank, and Andhra Bank would be in focus as these banks release their Oct-Dec earnings.
SBIN (State Bank of India) has added significant amount of short positions and rollovers have also have been very strong. After tepid QIP (qualified institutional placement) response, hike in interest rate stock has been under pressure. Comments from finance ministry officials on retail loan-linked capital infusion in state-owned banks would also be keenly watched. Earlier this week, Cogencis reported that the finance ministry has asked state-owned banks to give details of their credit growth during the festive season by Jan 31 to check their eligibility for additional capital infusion. The government, which has already infused 140 bln rupees in public sector banks, has promised further capital infusion after ascertaining their retail lending performance between October and January.
