Banking stocks take a breather after spectacular rally

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Banking stocks take a breather after spectacular rally
Banking stocks which have been rallying ever since Raghuram Rajan took charge of the RBI, took a breather today with the Bank Nifty dropping in trade.

Among the top losers from the banking space in trade today was Yes Bank which shed almost 2%, while other prominent losers were ICICI Bank, Kotak Bank and Punjab National bank.

A few banking stocks, however, bucked the trend, particularly the state run banks with notable gainers being Union Bank of India, Bank of Baroda and Central Bank of India.

Banking stocks have been rallying ever since Raghuram Rajan took over as the RBI governor, which saw a number of measures for banks, particularly for raising money from abroad.

His measures for the forex markets, has also seen the rupee rallying substantially. This has led to bond yields dropping and bond prices gaining.

The result has been that shares prices of banks have rallied substantially from their 52-week lows. For example, Yes Bank has jumped from levels of Rs 222, to the current levels of Rs 301.

Markets are now awaiting Rajan's first monetary policy review, which will be delivered on Sept 20.

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