Bank Stocks Outlook for the week – 17 to 21.07.2017
Bank Stocks Outlook for the week – 17 to 21.07.2017
( www.rupeedesk.in )
Bank stocks are seen leading gains in the broader equity markets next week, tracking Apr-Jun earnings updates and on rising expectations of a repo rate cut in August by the Reserve Bank of India, as retail inflation slipped below the lower threshold of 2% in June. The case for a repo rate cut is almost done, and banks are rallying on hopes that a further cut would spur lending growth. The RBI will have no real reason to not cut repo rate with CPI at 1.54% in June. Additionally, we believe that the banking universe, there is a case for selective buying of stocks such as State Bank of India, Bank of Baroda, ICICI Bank and HDFC Bank. On the technical front, Nifty Bank is seen facing initial resistance at 24,150, followed by resistance at 24,400, while support is seen at 23,550 and 23,200. The government mulling recapitalisation bonds to provide capital to state-owned banks. Earnings due over the weekend and in the coming week such as DCB Bank, Karnataka Bank, Canara Bank, Kotak Mahindra Bank, and RBL Bank will provide stock-specific triggers. IndusInd Bank and South Indian Bank are the key banks that have announced earning so far, with the former continuing with a solid performance, while South Indian Bank leaving most disappointed. IDFC Bank continues to b in focus with the decision of IDFC Group-Shriram Group to merge operations with each other announced on Saturday. Have cast aspersions on the deal structure, regulatory issues, and ability of both groups to get their operations synced. The merger is likely to be a long drawn process given the complexity of the transaction and the number of approvals required. Although finer details about the financials are yet to be revealed, prima facie, IDFC Bank and Piramal Enterprises (of all the stakeholders involved) appear to be beneficiaries from the merger.
Source : Cogencis Information Services Ltd.
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Bank Stocks Outlook for the week – 17 to 21.07.2017
( www.rupeedesk.in )
Bank stocks are seen leading gains in the broader equity markets next week, tracking Apr-Jun earnings updates and on rising expectations of a repo rate cut in August by the Reserve Bank of India, as retail inflation slipped below the lower threshold of 2% in June. The case for a repo rate cut is almost done, and banks are rallying on hopes that a further cut would spur lending growth. The RBI will have no real reason to not cut repo rate with CPI at 1.54% in June. Additionally, we believe that the banking universe, there is a case for selective buying of stocks such as State Bank of India, Bank of Baroda, ICICI Bank and HDFC Bank. On the technical front, Nifty Bank is seen facing initial resistance at 24,150, followed by resistance at 24,400, while support is seen at 23,550 and 23,200. The government mulling recapitalisation bonds to provide capital to state-owned banks. Earnings due over the weekend and in the coming week such as DCB Bank, Karnataka Bank, Canara Bank, Kotak Mahindra Bank, and RBL Bank will provide stock-specific triggers. IndusInd Bank and South Indian Bank are the key banks that have announced earning so far, with the former continuing with a solid performance, while South Indian Bank leaving most disappointed. IDFC Bank continues to b in focus with the decision of IDFC Group-Shriram Group to merge operations with each other announced on Saturday. Have cast aspersions on the deal structure, regulatory issues, and ability of both groups to get their operations synced. The merger is likely to be a long drawn process given the complexity of the transaction and the number of approvals required. Although finer details about the financials are yet to be revealed, prima facie, IDFC Bank and Piramal Enterprises (of all the stakeholders involved) appear to be beneficiaries from the merger.
Source : Cogencis Information Services Ltd.
