Nifty Bank jumps 1.4% from day's low as markets shrug off Trump tariff jitters; ICICI, Kotak Mahindra Bank lead recovery

Bank Nifty recovers all losses

The Nifty Bank index sharply rebounded from day’s low, amid a broad-based recovery in the stock market. This comes as the impact of Trump tariffs gradually faded away from the market.

After US President Donald Trump announced 25 percent tariff and a penalty on India, Indian benchmark indices opened in the red with significant losses. However, Sensex and Nifty sharply recovered all losses later.

Nifty Bank, which had declined more than 600 points in the morning to hit a low of 55,547, regained more than 750 points (1.4 percent) from that level to swing into the green territory. It is currently up nearly 150 points (0.27 percent) to stand at 56,300.

The recovery was led by private banks, with Kotak Mahindra Bank and ICICI Bank leading gains, rising nearly 1 percent each. Axis Bank and Bank of Baroda shares gained more than 0.5 percent each. IDFC First Bank, HDFC Bank, AU Small Finance Bank and State Bank of India were hovering in the green with marginal gains.

Punjab National Bank (PNB) shares dropped 2 percent, after weak Q1 results. Federal Bank, IndusInd Bank and Canara Bank shares were hovering in the red with marginal losses.

On the technical front, the index has broken key resistance levels suggested by analysts. This may imply strong upside potential for the bank index. "A sustained move above 56,275 could lead to a rally toward 57,000 and 57,630," said Hardik Matalia, Derivative Analyst - Research at Choice Equity Broking Private Limited.

"The broader price structure continues to reflect a bullish bias, making dips a buying opportunity for positional traders," he said.

Motilal Oswal Wealth Management in its report stated that Bank Nifty's support is at 55,750, and then at 55,500. Resistance was quoted at 56,350, and then at 56,500. "Now it has to hold above 56,000 zone for a bounce towards 56,350 then 56,500 levels while a hold below the same could see decline towards 55,750 then 55,500 zones," it said.

US President Donald Trump on July 30 announced 25 percent tariffs and an additional penalty against India ahead of the August 1 deadline. In a post on Truth Social, Trump described India as America's "friend" but added that it will face 25 percent tariffs plus a penalty for buying Russian military equipment and oil. The US President reiterated that India has among the "highest tariffs in the world".

"Seasoned investors know markets rarely reprice on the headline alone. Beneath the volatility lies a set of divergent sectoral narratives that deserve attention," said Bhavik Joshi, Business Head at INVasset PMS.