GetPaidIndia.com

Markets continue to slip; Bank, Consumer Goods indices down over 1%

August 28th, 2008

Thursday, August 28, 2008 2:31:11 PM IST

The markets are slowly melting down though they made few attempts to return back towards the green. Nifty is at 4267.90 down by 0.56%. BSE Sensex is down by 114 points and is at 14182 levels. Banking indices, both on BSE and NSE are down over 1%

CNX IT is down 0.91%. Bank Nifty is down 1.02%. Capital Goods and Banking sectors are down over 1% on the BSE Sensex.

The Ruppee appreciating on one side and crude oil softening on the other coupled with a possible impact of US Oil production due to the storm are driving the global markets.

The Indian Banking sector is one of the worst hit sectors in the recent stock market crash. Both internal factors (such as MTM losses etc) and external factors (oil price play, inflation, RBIs more frequent interference) has made Banking stocks tumble down. While this is a pain for the stock traders, the current price levels are found to be attractive, particularly to some breed of stocks. Of course, Banking stocks are always considered a save haven to invest on extreme long terms.

Not many analysts firms give a buy rating to the banking stock considering there are multiple factors that interfere. However, HDFC Bank amongst the Largecap banking stocks got a “Outperformer” while “Union Bank of India” amongst the mid/small cap banking stocks got a “Buy” rating from market research firms.

UBIs good asset quality, high loan book, operating efficiency and ample opportunities and initiatives (such as the joint venture with Dai-Ichi Insurance, Japan for insurance, KBC Asset Management NV, Belgium for Asset Management Business, Wealth Advisors (India)
Private Ltd for wealth management services) makes it a good best amongst its peers.

1 U.S. dollar = 43.5255 Indian Rupees
1 U.S. dollar = 108.9087 Japanese Yens
1 U.S. dollar = 0.6770 Euros
1 Ounce Gold = $831.90
1 Barrel Crude Oil = $118.81

Entry Filed under: Equity Markets, Banks & NBFC