The Nifty Bank recorded its longest losing streak in nearly 23 years, falling for the ninth consecutive session on Wednesday, the day of weekly expiry for its options contracts.
The index fell 3.5% over the period, with Bank of Baroda and Punjab National Bank leading the decline.
Index constituents lost a cumulative market capitalisation of Rs 1.37 lakh crore over the nine-session period, led by State Bank of India. The public sector bank contributed by a third of the decline in the index constituents' market cap, eroding investor wealth by over Rs 54,000 crore.
The nine-session losing streak is the longest since September 2001, when the index fell for 10 consecutive sessions, declining by 19% over the period.
Analysts' Views
With the index trending on a steady decline, analysts' views on its forward trajectory remain mixed.
"The Bank Nifty experienced another day of sideways trading, indicating ongoing indecision between bulls and bears, marked by the formation of a doji candle," Rupak De, senior technical analyst at LKP Securities, said. "Key levels to watch include support at 46,000 and resistance at 47,000, where the highest put and call open interests are concentrated."
"Short buildup in HDFC Bank has been weared off," Aditya Agarwala, head of research and investments at Invest4edu, said. "[The] components are poised fully well, market is waiting for a good trigger. A rally of 1,000–2,000 points wouldn't be surprising," he said.
Historical Performance
The benchmark index for banks recorded the worst performance among the sectoral index pack, gaining only 12% as compared against the market benchmark Nifty 50, which grew over 20% in 2023.
Nifty Bank's underperformance during the year was led by private banks as Bandhan Bank Ltd. and Kotak Mahindra Bank Ltd. were its biggest lagging constituents.
In comparison, the Nifty PSU Bank index grew 32% last year, and is trading nearly 17% higher since the beginning of the current year.
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