The Nifty PSU Bank index rose 2% to 8,534.95, demonstrating strong performance in the banking sector. As reported by Business Standard, the broader market outperformed the frontline indices, with the Nifty 50 index up 0.89%. The positive momentum was supported by sharp decline in crude oil prices, encouraging quarterly earnings and renewed foreign fund inflows. At 1:44 PM, the Nifty PSU Bank index was up 1.33% at 8,478.80, with all PSU bank stocks gaining.
ICICI Securities has initiated coverage on seven public sector banks, assigning a 'Buy' rating to Indian Bank, Union Bank of India, Bank of Maharashtra, Canara Bank, Bank of Baroda, Bank of India and Punjab National Bank. The brokerage has also resumed coverage on SBI with a 'Buy' rating. According to The Economic Times, ICICI Securities estimates healthy loans CAGR of ~14-15% for FY26–28 and predicts strong return on equity for these institutions leading up to fiscal year 2028. The brokerage maintains a positive stance on the banking sector, with NII growth having risen to double-digit and should accelerate further due to broadly stable NIM.
Indian Bank received a 'Buy' rating with ICICI Securities pegging their target multiple slightly higher than estimated RoA, due to its superior NIM/core PPOP and better positioning on ECL. The brokerage estimates stable RoA (1.3%) for FY27–28, aided by benign credit costs and superior PPOP. Bank of Maharashtra was assigned a 'Buy' rating for its strong fundamentals including ~50% CASA, amongst the lowest cost of deposits, superior loan growth, 99% PCR including TWO, <15bps NNPA and 24% RoE. Union Bank of India received a 'Buy' rating with the target multiple similar to estimated RoA, citing superior core/headline RoA and growth acceleration potential under the incumbent MD&CEO.
Ponmudi R, CEO at Enrich Money noted that the Nifty PSU Bank Index is showing signs of gradual recovery after correcting nearly 15-18% from its February peak. According to Business Standard, he attributed the rally to improving fundamentals, attractive valuations, and expectations of healthy Q1 earnings. Vipin Kumar, AVP Research at Globe Capital Market explained that the index is consolidating within a 'Triangle' pattern with immediate support at 8,200 level, followed by 8,000. On the upside, resistance is positioned around 8,700–8,800 zone, with a decisive breakout potentially setting the stage for the next directional move.
Effective 3 August 2026, the Closing Auction Session (CAS) has been introduced for stocks in the F&O segment, revising market closing timings while keeping opening times unchanged. Continuous trading in F&O stocks will now end at 3:15 pm, followed by the closing auction session, while non-F&O stocks will continue to trade until 3:30 pm. Trading in index and stock futures and options will conclude at 3:40 pm. The new mechanism is aimed at enhancing price discovery for the official closing price, reducing end-of-day volatility, and facilitating transparent execution of large institutional orders. Additionally, the Reserve Bank of India's Monetary Policy Committee (MPC) begins its three-day meeting today amid rising global inflationary pressures and elevated crude oil prices.
