Bank Nifty hits all-time high today: Here we decode why
What's the story
The Bank Nifty index has hit a record high today, crossing the 58,900 mark for the first time. The surge comes after a steady rise in the index over recent sessions. Heavy buying in major private lenders and strong sectoral sentiment have been driving this growth. The latest move builds on the index's 17% gains over the past year, outperforming the 10% rise in Nifty 50.
Market performance
Bank Nifty's record-setting run continues
The Bank Nifty index continued its record-setting run from last week, hitting an intraday high of 58,913.70 in early trade today. The index was up by 0.7% from its previous close with 11 out of the 12 stocks on it trading in green.
Stock performance
Banking shares lead the charge
The rally in the Bank Nifty index was led by a surge in banking shares, particularly Canara Bank, IDFC First Bank, AU Small Finance Bank and Kotak Mahindra Bank. These stocks rose between 2% and 2.5%, making them the top performers of the session. The strong performance of these banking stocks has contributed significantly to the record high of the Bank Nifty index today.
Corporate news
Kotak Mahindra Bank announces stock split proposal
Kotak Mahindra Bank, India's third-largest private lender by market value, gained 2% to its day's high of ₹2,116.80, after announcing that its board shall consider a proposal to split its stocks on November 21. This is the bank's first such move in 15 years and has contributed to the positive sentiment around banking stocks today.
Investor sentiment
Corporate performance boosts investor confidence
Investors have also been buoyed by stronger-than-expected corporate performance. Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted that Q2 results so far indicate an uptrend in earnings growth with the net profits having grown by 10.8%, the best in the last six quarters. He said these results beat earlier estimates and show promise of carrying into the next quarter amid improved consumption trends and discretionary consumption leading earnings growth.