Bank stocks recorded significant gains on June 26, pushing the Nifty Bank index higher up in the green to hit a fresh all-time high of 57,263.45. The surge in the segment was led by heavy buying in private bank stocks.
Heavyweight HDFC Bank shares jumped nearly 2 percent to hit a fresh all-time high of Rs 2,027 apiece, closing as one of the top gainers and biggest contributors to the uptrend in benchmark indices Sensex and Nifty.
HDFC Bank shares have now extended gains for the third consecutive session. This comes as its subsidiary HDB Financial Services sees decent investor interest for its Rs 12,500 IPO.
Notably, HDFC Bank had set tomorrow (June 27) as the record date to determine the eligibility of the shareholders set to receive its dividend payment. The rise in the share price comes ahead of the record date.
AU Small Finance Bank shares rose over 1.7 percent to close at Rs 821 apiece, while Axis Bank shares gained 1.5 percent to end the session at Rs 1,231 apiece.
ICICI Bank shares were trading nearly 1 percent higher, while IndusInd Bank, Punjab National Bank (PNB), Canara Bank, Bank of Baroda and Kotak Mahindra Bank shares were trading in the green with marginal gains.
Dodging the uptrend in the segment, the shares of State Bank of India (SBI), Federal Bank, and IDFC First Bank were trading in the red with marginal losses.
Will Bank Nifty cross 58,000 soon?
Analysts however expect the bullish rally to continue, with Bank Nifty hitting further highs. "Overall, I expect Bank Nifty to cross 58,000 over next 2-3 weeks. If it holds above 56,250, looks for an upside target of 57,050 today. I am expecting momentum in both Nifty and Bank Nifty post this expiry," said Chandan Taparia, Senior Vice President, Head - Derivatives & Technical Research, Motilal Oswal.
What led to the rally?
Ajay Bagga, Independent Analyst, meanwhile held India's macroeconomic indicators as key to the index's growth. "Given the manifold actions by RBI, which has cut rates, injected ample liquidity into the money markets, has been pragmatic in undertaking macro prudential easing and has been providing regulatory relief, banks are poised to benefit in the next few quarters. India's robust macro, tailwinds from a good monsoon, income tax relief injecting some purchasing power in the pockets of the middle class and falling inflation all have created a good backdrop for credit growth," he said.
Bhavik Joshi, Business Head at INVasset PMS, cited the liquidity-driven shift in the Indian financial ecosystem as a key factor behind the surge in Bank Nifty. "The Reserve Bank of India has been at the forefront, executing a series of bold monetary actions to stimulate the economy. These include a total of 100 bps in repo rate cuts this year (25 bps each in February and April, followed by 50 bps in June), alongside a 100 bps CRR reduction. Most notably, the RBI recently conducted a $10 billion (₹87,000 crore) 3-year USD/INR swap, injecting long-term liquidity into the system," he said.
"Bank Nifty's leadership in 2025 is a reflection of this macro transformation. It’s not just a stock index hitting highs—it’s the financial heartbeat of a growing economy, powered by a central bank committed to supporting India’s next phase of expansion," he added.
Sunny Agrawal of SBI Securities highlighted the surge in HDFC Bank and ICICI Bank's shares as a significant driver of the surge in the bank index. "HDFC Bank and ICICI Bank account for approximately 50% of the Bank Nifty weight and today we have seen HDFC Bank hitting life high thereby pulling the entire index up. Moreover, ICICI Bank is also trading very close to its life highs. Overall, banks are well placed to enjoy better credit growth, on the back of recent drop in repo rate, albeit, NIMs may come under pressure during 1QFY26 and then gradually improving during FY26, with strong exit in 4QFY26," he said.
Bank Nifty has been outperforming the Nifty 50 index since the beginning of 2025, posting gains of nearly 12 percent compared to the benchmark's 8 percent gain, said Ravi Singh, SVP - Retail Research, Religare Broking. Speaking about today's rise Singh said that the uptrend was helped by RBI's recent steps like cutting interest rates and reducing CRR, which made investors more confident about the profits of banks.
"On the technical charts, Bank Nifty is likely to move towards the 57,800–58,200 zone in the near term, provided it sustains firmly above the 56,800-breakout level. For the July expiry, the highest open interest build-up is observed at the 56,000 strike, indicating strong support. Overall, sentiment remains positive, with 56,500–56,200 acting as a key support zone and 57,200 as the immediate hurdle for further upside. Traders can look to deploy a “Buy on Dips” strategy in the banking index," Singh said.
Nifty Financial Services also recorded significant rise today. The index jumped nearly 1 percent to hit a fresh record high of 27,144. ICICI Prudential Life Insurance Company, Jio Financial Services, Shriram Finance and Bajaj Finance surged over 2 percent each to emerge as the top gainers on the index.
Also read: Our LIVE blog on stock market updates
Disclaimer: The views and investment tips expressed by experts on Moneycontrol are their own and not those of the website or its management. Moneycontrol advises users to check with certified experts before taking any investment decisions.
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