Nifty PSU Bank index extended its march to second consecutive day on November 25, rising as much as 7 percent in two days in an upbeat market. The rally comes on the back of strong market sentiment after BJP-led Mahayuti alliance emphatic victory in Maharashtra state elections, with Street shrugging off concerns over the NDA's waning popularity.
In two days, Nifty PSU Bank was the best sectoral performer out of the remaining indices. Meanwhile, benchmark indices Sensex and Nifty gained up to 5 percent during the same time period.
Individually, shares of Central Bank of India, Indian Bank, UCO Bank, PNB, Bank of Baroda, SBI, among others were up in the range of 3-7 percent on November 25.
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"The Mahayuti win bodes well for Maharashtra, as consolidated Centre and state politics should allow a pick-up in stalled infra development and other pending issues," noted analysts at Emkay Research.
Elara Securities, too, believes that the resurgence in performance of the BJP in assembly elections after failing to secure a majority in Lok Sabha elections should help assuage investor concerns about the government’s policy priorities and development agenda.
"Doubts regarding the slow progress of government spending, especially capex, should be behind us, as the next two elections in 2025 -- Delhi and Bihar -- are unlikely to consume as much bandwidth as Maharashtra and Haryana did. This should have a positive impact on capital goods as well as PSU stocks as the government’s order awarding activity will likely show traction hereafter," the brokerage firm added.
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