The Nifty Bank index has turned volatile, in-line with benchmark indices, giving up early gains on April 8 to drop over 700 points from early highs, then clawing back, a day after the marketwide crash on jitters over Trump tariffs and ahead of the MPC decision.
Sensex and Nifty 50 have made some recovery on April 8 after falling sharply on April 7, with the bank index too making strong recovery after closing nearly 3 percent lower on April 7.
The volatility seen around the bank stocks also comes ahead of the anticipation of a rate cut by RBI’s during its MPC review, which is set to announce its decision on April 9.
The shares of State Bank of India (SBI) were the top gainer on the index. The stock jumped nearly 2 percent to trade at Rs 761 per share in the morning. AU Small Finance Bank, Axis Bank and Bank of Baroda shares were meanwhile trading over 1.3 percent higher each.
Canara Bank, IDFC First Bank, HDFC Bank, ICICI Bank, IndusInd Bank and other bank stocks were trading in the green with marginal gains.
Axis Securities has held a cautious outlook for the Nifty Bank index. "Despite forming a bullish candle on the daily chart, the presence of an upper shadow indicates selling pressure at higher levels, suggesting resistance and caution in the upside momentum," the brokerage said.
Emkay Global Financial said, "Global sentiment has seen a shift and is rippling through the equity, bond, and FX markets in the thick of tariff shock and geopolitical concerns. Amid great policy and trade uncertainty, the overarching theme is increasing recessionary fears in the US and possibly even the global economy, led by macroeconomic shocks if these policies are sustained…The tariff shock has increased our conviction that the RBI will cut 25bps this week, with further easing ahead. This could also be accompanied by a change in stance to 'accommodative' from 'neutral' to give directional easing bias."
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