Bank Stocks Outlook for the week – 12 to 16.10.2015
(To
take cues from CPI, IIP, Jul-Sep results)
The
September retail inflation and August industrial growth data to be released on
Monday will decide the course for bank stocks next week, while bias is expected
to remain positive tracking the broader market outlook.
Select
banks are expected to continue to trend upward on the Reserve Bank of India's
decision Thursday to lower risk weight requirements on some home loans.
Stocks
of State Bank of India, IDBI Bank, and Bank of Baroda are seen outperforming
the sector. The Bank Nifty is seen taking support at 17,170 points and facing
resistance at 17,800 points. The banking gauge has ended its volatile week with
modest gains of 2.5%.
Banks
such as DCB Bank, Karur Vysya Bank and Lakshmi Vilas Bank will be in focus as
they will detail their Jul-Sep earnings next week. Economic data will be a key
input but with start of earnings, there will be a lot of stock specific action.
From
a medium term perspective, how the asset quality trend is panning out, especially
for state-owned banks, will be keenly watched.
