PSU Banks in India have always
been vulnerable to Govt Policies. Quarterly results produced a mixed set of
performance.
Sector Index has been falling
consistently since Jan 2015. Though the overall market was also not been doing
good from since the same date, the difference here is that, many other sectors
have tried to bounce during better periods. However for the similar periods the
spike in PSU bank stock has been minimal barring some exceptions like SBI.
From monthly chart enclosed
here, you can see that PSU Bank Index is trading near its low of Feb 2016. Most
Technical Indicators are oversold. The index chart is also trading near gap
which was formed on 2 March 2016. This suggests an expected demand level in
most PSU Bank Stocks.
On daily chart the Index chart
showing a nice momentum. Next resistance is around 2300 which is 5% from here.
On a little higher time frame the index can move up to 2900 levels in couple of
months. That makes it an upside of 33% from current levels.
Though charts and overall
performance is currently not looking good, this can be treated as a contra bet.
Some banks on radar can be
IOB, State Bank of India, Allahabad Bank, Andhra Bank, Union Bank
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