Private Banks not strong space for trading

CNBC-TV18s Executive Editor, Udayan Mukherjee –

Private Banks is a weak segment. We had a very smart bounce back like the rest of the market and private banks, which had fallen off which was a favourite weeping boy in January and March, they bounced back quite a bit. But the market is still quite a bit off its March lows but some of these private banks have already started going back below their March lows.

I mean case in point Axis Bank at Rs 750 now; Rs 750 was the March low, it lost 23% from its recent peak of about Rs 970. That’s a sharp crack for a market, which has not corrected so much. Development Credit Bank (DCB) is even worse the stock is now languishing at Rs 70; the March low was Rs 80. So here is a stock which has already fallen some 12-15% below its March lows. The recent high was Rs 120 from that the stock has corrected 43%. Kotak Mahindra Bank is not so bad, the stock is still holding about Rs 650 the March low was about Rs 550. So it is not quite there yet. Yet the stock has fallen some 27% from its recent pullback high of Rs 890.
 
These are not- seeming like strong stocks- these private banking stocks particularly the liquid ones. Some of them are already at March lows some of them have lost between 25-40% from their recent highs. At some point they will present opportunities to buy but right now with all that’s going on in the world of finance, I think the screen is telling you that this is not a particularly strong space from a trading perspective to be in.