Bank Nifty 16th Dec 2015
Bank Nifty /Bank Nifty Futures continues its under performance. We have been saying since past 4 months please use all rise to get out of all private sector banks like Axis Bank, Icici Bank, Yes Bank but most people (traders and investors did not understand what we were trying to communicate ) Today when most of these stocks are nearing and hitting 52 week lows at that juncture most traders and investors are asking what the hell has gone wrong in these banks. These were the stocks that were considered the very top cream layer of stocks in Indian Stock Market and yet they are the worst performers of 2015 why? Payment wallets are just one part of the problem, RBI is forcing these banks to have higher levels of transparency and that will expose the bigger balance sheet problems as soon as Q3FY16. Be very careful in this sector.
As I have explained time and again and at the cost of repetition will once again try to drill in your mind. News is always a trailing indicator, price and patterns are always a leading indicator. When insiders know that there is something terribly wrong happened in the growth story they just start dumping and that becomes evident on teh share prices and volume also indicates the same. Now both price and volume have been very clearly indicating that this sector is going to under perform. Add to that the entire Fund Manager community is still overweight this sector (although some smart guys have trimmed exposure over past few trading days but still Private sector banks can be seen in top 10 holdings of all big funds and whenever the trade is so crowded and unanimous all ways the prices have moved in the opposite direction)
We once again recommend to skip this sector totally and switch over to Renuka Sugar, Bajaj Hindustan and Eid Parry. All the three will give superb returns over the next 23 months. In fact we believe they will outperform the Indian Stock market by a huge margin.
Good Trading To You!