The Nifty PSU Bank index gained 2% on Tuesday amid heavy buying in Union Bank, Canara Bank, Syndicate Bank, Bank of India, and Indian Bank.
The index’s gain could also be attributed to the Reserve Bank of India’s forex swap auction. In this, the RBI will buy dollars from banks for three years and offer them rupees in return. The move will bulk up the central bank’s foreign-exchange reserves while injecting cash into the banking system to ease the liquidity crunch.
Shares of Union Bank, Canara Bank, and Syndicate Bank, which gained 3% each, were leading the index’s gain. Shares of Bank of India, Indian Bank, PNB, and Oriental Bank of Commerce also contributed to the gain, rising 2% each. Shares of Bank of Baroda, IDBI, SBI, and J&K Bank gained 1% each.
Meanwhile, equity benchmark indices were trading in the green on Tuesday with the Sensex gaining 25 points at 37,834 levels. The Nifty rose 9 points to trade at 11,363, struggling to hold its key level of 11,350.
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