Bank Stocks Outlook for the week – 03 to 07.08.2015
Bias
positive next week; RBI policy in focus
( www.rupeedesk.in )
Bank
stocks are expected to trade with a positive bias next week despite much hope
for a rate cut
from
Reserve Bank of India on Tuesday. According to a Cogencis poll, the RBI is
likely to keep the repo rate unchanged at its bi-monthly policy statement. With
a 25-bps repo rate cut on Jun 2, the RBI had reduced its policy rate by a total
of 75 bps in 2015. The Bank Nifty ended at 18729.85 today.
Also,
the government yesterday said it will infuse 700 bln rupees in public sector
banks over the next four years, including 250 bln rupees in the current
financial year, giving a boost to investor
sentiment.
The
government will provide 250 bln rupees each in 2015-16 and 2016-17 and 100 bln
rupees each in 2017-18 and 2018-19 from budgetary resources. According to
earlier RBI estimates, the capital requirement for public sector banks was over
2.40 trln rupees by 2018-19 under Basel III. Most banks look good in the
short-term the next one week, but in the medium term, Punjab National Bank and
Bank of Baroda should be looked at by traders. Also, there will be
stock-specific action in
