Banking Sector Stocks Crash: Shares of HDFC Bank and Axis Bank fell by 5%, know why there was panic in the market?

Business Desk – Banking Sector Stocks Crash: On Monday (July 20), the first trading day of the week, the stock market started with weakness. As soon as the market opened, there was widespread selling, although there was buying in some selected stocks. The banking sector was under the most pressure in Monday’s trading.

After the first quarter results, there was sharp selling in the shares of HDFC Bank, Axis Bank and Kotak Mahindra Bank. Shares of HDFC Bank and Axis Bank fell by about 5% in early trade, while Kotak Mahindra Bank fell by about 3%. Due to the huge weightage of these three banks in Sensex and Nifty, it had a direct impact on the entire market. However, ICICI Bank shares were seen trading with a rise of about 1%, which provided some support to the banking index.

Buying in PSU banks, rise in PNB and SBI

While shares of private banks remained under pressure, buying was seen in public sector banks. The first quarter results of Punjab National Bank (PNB) were considered positive by the market, after which its shares registered a rise of about 5% during early trading. At the same time, shares of State Bank of India (SBI) were also seen trading with a gain of more than 1%. This indicated that investors are betting on banks giving better quarterly results.

Shares of Reliance Industries also remained in focus

After the quarterly results, Reliance Industries shares were also in the eye of investors in Monday’s trading. In early trading, the company’s shares were seen trading with a gain of about 1%. Amid heavy selling in banking stocks, the buying in Reliance tried to support the market to some extent. Analysts believe that investors remain confident about Reliance’s energy and retail businesses, although its impact was limited in the face of a major decline in the banking sector.

24,200 level is important for Nifty

According to technical analysts, the level of 24,200 is currently an important support for Nifty. On Monday, the index appeared to be slipping below this, which indicated weakness in the market. If Nifty remains below this level, selling pressure may increase. The index can go up to the psychological level of 24,000. At the same time, if there is recovery in the market then the level of 24,300 will be the major resistance in the near term. Only if it remains above this level, signs of strength can be seen in the market.

Investors will keep an eye on these factors

Analysts say that the direction of the market in the coming days will largely be decided by the corporate earnings season. Investors will keep an eye on the quarterly results of Bajaj Auto, IT companies and other big companies. Apart from this, the activities of foreign institutional investors (FIIs), performance of the banking sector and the trend of global markets will also play an important role in determining the movement of the domestic stock market.

Market experts believe that despite good results of many companies, if they do not live up to market expectations, then profit booking by investors may continue. In such a situation, there is a possibility of fluctuations in the stock market in the near term.