Banking stocks see profit booking ahead of RBI policy meet

Banking stocks started the week on a negative note dragging benchmark indices lower a day ahead of the Reserve Bank of India RBI's MPC meet. According to experts, RBI could decide against interest rate cut this time which dampened investor sentiment. 

While Bank Nifty fell 567 points to 21,072, BSE bankex declined 672 points to 23,926 today. Profit-booking and uncertainty ahead of the monetary policy meet led to decline in banking stocks today. SBI was the sole gainer on BSE bankex, rising 0.34% to Rs 192.10.

Bandhan Bank stock was the top  loser intra day falling 11.89% to Rs 304.2 against previous close of Rs 345.25 on BSE. Kotak Bank, RBL Bank, IndusInd Bank, HDFC Bank and Axis Bank fell over 3% each in afternoon trade on BSE bankex.

Share Market News: Sensex drops 667 points, Nifty at 10,899; HDFC Life, Axis Bank, ONGC top losers

Bandhan Bank share price fell after its main promoter Bandhan Financial Holdings sold 337.4 million shares in the Indian lender. Shares were worth Rs 10,500 crore changed hands in a block deal in early trade today. The floor price was about 10 per cent lower than Bandhan Bank's Friday closing price of Rs 345.25.

On Sensex, top banking losers were Kotak Mahindra Bank (4.41%), IndusInd  Bank (3.67%) , Axis Bank (3.30%) and HDFC Bank (2.50%).  On Nifty, top banking losers were IndusInd  Bank (3.73%), Kotak Mahindra Bank (3.57%) and Axis Bank (2.93%).

Vinod Nair, Head of Research at Geojit Financial Services said,"Indian benchmark indices closed in the negative with losses, following mixed global cues. As virus cases continued to rise and with the uncertainty regarding rate actions by the RBI, markets succumbed to the momentum slowdown visible in the last couple of trading sessions. Losses were led by financials. Although momentum has slowed down, stock specific action is still happening, dependent mainly on the earnings results and commentary. As long as the markets hold the current range, these downturns could be shortlived and should be utilised to accumulate quality stocks."

RBI MPC meet to start tomorrow; to announce policy stance on August 6