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News Topical, Digital Desk : The Nifty PSU Bank Index declined for the fourth consecutive day on Monday, March 16. The PSU Bank Index fell nearly 14 percent in March, erasing all gains made in the first two months of the year. All 12 stocks in the index declined this month. This decline led to three stocks reaching 52-week lows.
- Punjab & Sind Bank Share Price - Punjab & Sind Bank share price fell by 3.81 percent to Rs 22.70.
- Indian Overseas Bank Share Price - Indian Overseas Bank share price fell by 2.24 percent and reached Rs 31.88.
- UCO Bank Share Price - UCO Bank share price fell by 2.21 percent and came down to Rs 24.76.
Decline in 8 out of 10 trading sessions
After falling nearly 4 percent last Friday, the Nifty PSU Bank index fell again on Monday, losing about 0.6 percent. All stocks in this index are currently trading in the red. The index has seen declines in 8 out of the last 10 trading sessions.
Why did the Nifty PSU Bank Index fall?
Rising bond yields have had a significant impact on PSU banks. India's 10-year bond yield is currently around 6.68%. This increase was driven by rising crude oil prices due to the war in West Asia, putting pressure on PSU bank stocks. During last week's sell-off, the 10-year yield reached around 6.8%.
PSU banks typically hold a large portfolio of government securities. Most of these securities are in the Hold-to-Maturity (HTM) category, while a significant portion is also held in the Available For Sale (AFS) category.
All 12 stocks fell this month,
with some falling between 12% and nearly 16%, such as Bank of Maharashtra and UCO Bank. The decline in March could be the index's biggest monthly decline since September 2020, when the index fell by nearly 16%.
The Nifty PSU Bank Index hit a high of 9,918 on February 26. Since then, the index has lost nearly 14%. In market parlance, this is called a technical correction. When an index or stock falls 10% from its high, it is considered a technical correction.
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