The benchmark BSE Bankex has gone up by almost 5 per cent over the past week. The banking sector, which also witnessed sharp downfall on the back of global/political crisis, is now back in the limelight. The rise in stock prices has been substantial in the case of second-rung banking stocks.

Analysts point out GDP growth rate as an essential factor for the banking stocks to do well. There has been a correlation between the GDP and the credit growth of banks, and with India projecting 9 per cent plus growth, the sector is expected to do well.

The macro factor of GDP growth is one of the reasons, which drive the market sentiment towards the banking stocks. Inflation also came under control and overall the economy is growing, so the banking sector has to do well.

The rise in stock price has been substantial in the case of second-rung banking stocks on the whole. Yes Bank has gone up by 9.04 per cent over a week, Axis Bank went up by 9.06 per cent whereas Indian Overseas bank grew by 10.22% and Karnataka Bank by 9.74% since the past week.

According to analysts, the valuations in the case of first-rung stocks such as ICICI Bank is higher, their PE (price to earning) ratio is also higher unlike the second-rung stocks which are preferred by the investors as their valuations look more attractive.

Bank	Close price as on		%Change
	4-Sep	20-Aug
Indian Overseas	129.4	117.4	10.22
Karnataka Bank	189.8	172.95	9.74
Andhra Bank	85.65	78.3	9.39
Axis Bank	658.65	603.95	9.06
Yes Bank	186.45	171	9.04
Union Bank (I)	144.15	132.7	8.63
Federal Bank	345.65	323.45	6.86
Oriental Bank	216.65	203.7	6.36
Kotak Mah. Bank	729.65	686.45	6.29
Allahabad Bank	90.85	85.8	5.89
Bank of Baroda	283.45	269.75	5.08
Bank of India	247	235.55	4.86
HDFC Bank	1175.7	1125	4.51
St Bk of India	1610.35	1550.45	3.86
ICICI Bank	904.15	871.95	3.69
Centurion BnkP	40.45	39.8	1.63
Canara Bank	249.7	246.95	1.11
Pun. Natl. Bank	487.65	492.1	-0.90