Financial Daily from THE HINDU group of publications
Wednesday, Jun 11, 2003
Financial Daily from THE HINDU group of publications Wednesday, Jun 11, 2003 |
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Markets
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Stock Markets Money & Banking - Stocks PSU bank stocks lose most in panic selling Jayanta Mallick
KOLKATA, June 10 PUBLIC sector banks witnessed panic selling on Tuesday following confusion over the Central Government's stance on the recent volatility in these counters. The stocks of Punjab National Bank, Canara Bank, State Bank of India, Andhra Bank, Bank of Baroda, Indian Overseas Bank and Oriental Bank of Commerce came under substantial selling pressure.
As a result, the BSE-PSU index (dominated by PSU banks) fell 58.08 points or 2.67 per cent to 2116.70 points. Domestic institutions such as UTI and LIC reportedly sold PSU bank shares. Private mutual funds and some banks also reportedly reduced their portfolio. However, Mr Samir Arora, Chief Investment Officer of Alliance Capital, told Business Line: "We did not seek exit from any of the PSU bank stocks we hold. In fact, we have added more PNB, Canara Bank and J&K Bank stocks to our portfolio today." However, he admitted that the day's purchases were "not substantial by Alliance standards''. It was the third time in the last fortnight that the PSU bank stocks reacted sharply to North Block statements. The market players made a negative interpretation of the Finance Minister's statement on Monday that his Ministry had directed the Securities and Exchange Board of India (SEBI) to look into the "abnormal'' price movement in the PSU bank stocks over the past several weeks. "It was another day of panic for the PSU banks, as the stocks were punished by some inspired selling by domestic institutions,'' said Mr V.K. Sharma of Anagram Stockbroking. According to him, the market has more than discounted the negatives caused by the Finance Secretary's clarification that the Ministry has not made up its mind on the issue of premium for return of equity capital. The PNB stock closed at Rs 141.80 (Rs 150.70) while the Canara Bank counter finished at Rs 95.80 (Rs 103.30) on the NSE. SBI was down at Rs 354.70 at close against Rs 363.40 in the previous closing. Bank of Baroda finished at Rs 97.95 (Rs 106.70).
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