Public sector banks (PSB) shares were pressed on Tuesday and the Nifty PSU bank index on the National Stock Exchange (NSE) recorded a 5 per cent decline. This is the fastest ODI decline in 11 months.
Earlier on 4 June 2024, the Nifty PSU Bank Index fell 15 per cent in a single day on the results of the Lok Sabha elections. On Tuesday, the sharp decline in shares of public sector banks occurred after the news when the Bank of Baroda (BOB) reported a decline of 6.6 per cent on an annual basis in the net interest income (NII) in the quarter ended March 2025.
For example, analysts of Motilal Oswal Financial Services hoped that BOB’s NII would be Rs 11,660 crore (1 per cent fall on an annual basis). Meanwhile, the net profit of the government owned by the government gained 3.3 per cent to 5,048 crore on an annual basis.
Siddharth Khemka, head of research at MOFSL, said, the Nifty PSU index collapsed due to weak data from Bank of Baroda, which increased the pressure of sales. The growing tension between India and Pakistan and uncertainty on the upcoming interest rate decision of the US Federal Reserve also increased the market volatility. Analysts said the Supreme Court’s decision on Friday dismissed JSW Steel’s 2019 Samadhan Yojana for Bhushan Power and Steel and declared it illegal and ordered the liquidation of BPSL assets. This also affected the perception to some extent on Tuesday.
First Published – May 6, 2025 | 10:48 pm IST
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