Banking sector stocks depress equity indices

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On Wednesday, a massive sell-off in banking sector stocks pulled the equity indices lower.

Punjab National Bank (PNB) plunged 9.81 per cent after the state-owned lender said it has detected fraudulent transactions worth Dollars 1.77 billion (about Rs 11,335 crore).

Similarly, the wider Nifty50 of the National Stock Exchange declined by 38.85 points or 0.37 per cent to 10,500.90 points. On the BSE, the barometer 30-scrip Sensitive Index (Sensex), which opened at 34,207.57 points, traded at 34,381.94 points - up 225.99 points or 0.66 per cent from its previous close. The benchmark Shanghai Composite index rose 14.20 points or 0.45 per cent to 3,199.16.

However, it slipped on profit-booking to touch a low of 34,028.68. Separately, industrial output grew 7.1 percent in December compared with 6.2 percent forecast in a Reuters poll.

Foreign portfolio investors (FPIs) sold shares worth Rs 728.71 crore on net basis, while domestic institutional investors (DIIs) too sold equities to the tune of Rs 152.39 crore on Wednesday, provisional data showed.

WPI inflation easing to the six-month low of 2.84 percent in January and encouraging earnings by some blue chips boosted the sentiments, brokers said.

Tata Power rose about 1 percent on fund raising reports.

South Indian Bank (down 0.18 per cent) was the only stock in the Nifty Private Bank index that was slightly down around that time.

Punjab National Bank, the country's second-largest state-run lender, dropped as much as 12 per cent on the BSE index.

On the other hand, Axis Bank (1.37%), Hero Motocorp (1.28%), Asian Paints (0.98%), Cipla (0.37%), Coal India (0.34%), and ITC (0.34%) were the major losers in the Sensex.

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