PSU Banks Lead Early Decline in Nifty Bank; PNB Falls 0.92%, SBI and Federal Bank Offer Mild Support
By Shishta Dutta | Published at: Jun 20, 2025 11:37 AM IST
Mumbai, June 20, 2025: Banking stocks kicked off Friday’s trading session on a weak note, with the Nifty Bank index displaying a cautious undertone in the pre-open phase. The index edged down by a marginal 0.02% to 55,566.7, highlighting a lack of strong buying interest from investors amid mixed cues. Public sector banks bore the brunt of early selling, while a handful of private lenders tried to hold ground.
Pre-Open Snapshot: 5 Decline, 4 Unchanged, 3 Advance
The early trade data showed a mixed trend among the 12 Nifty Bank constituents.
- 3 stocks posted gains, led by State Bank of India (SBI) and Federal Bank
- 4 remained unchanged
- 5 registered losses, with Punjab National Bank (PNB) recording the steepest drop
| Stock | LTP (₹) | Change (₹) | % Change | Previous Close (₹) | Trend |
|---|---|---|---|---|---|
| PNB | 101 | -0.92 | -0.92% | 102.98 | Decline |
| FEDERALBNK | 204.75 | +0.83 | +0.41% | 203.92 | Advance |
| SBIN | 787.5 | +2.4 | +0.31% | 785.1 | Advance |
| CANBK | 104.89 | 0 | 0.00% | 104.89 | Unchanged |
| AXISBANK | 1217.5 | 0 | 0.00% | 1217.5 | Unchanged |
| ICICIBANK | 1411.3 | 0 | 0.00% | 1411.3 | Unchanged |
| AUBANK | 790.1 | 0 | 0.00% | 790.1 | Unchanged |
| KOTAKBANK | 2145 | -1.4 | -0.07% | 2146.4 | Decline |
| BANKBARODA | 231.3 | -0.36 | -0.16% | 231.66 | Decline |
| HDFCBANK | 1931.6 | -3.7 | -0.19% | 1935.3 | Decline |
| INDUSINDBK | 835.5 | -2.0 | -0.24% | 837.5 | Decline |
| IDFCFIRSTB | 69.5 | -0.21 | -0.30% | 69.71 | Decline |
PNB Tops Decliners Amid Heavy Selling Pressure
PNB faced intensified selling interest during the pre-open, with sell orders (7.09 lakh shares) nearly tripling the buy side (2.60 lakh shares). This imbalance pushed its indicative equilibrium price down by 0.92% to ₹101. Despite the downward momentum, PNB experienced healthy activity, with turnover reaching ₹2.08 crore, reflecting sustained investor engagement.
The negative sentiment surrounding PNB could be linked to concerns about slower loan growth and elevated provisioning expectations for Q1 FY26. No official statement has been released yet, but analysts remain cautious about PSU bank earnings in the near term.
SBI, Federal Bank Provide Some Relief
In contrast to the broader PSU trend, SBI opened higher by 0.31% at ₹787.5, backed by a decent trading volume of 32,832 shares. Investor confidence in the banking heavyweight remains intact, especially as recent reports indicate potential improvements in asset quality.
Federal Bank also managed to defy the general tone, gaining 0.41% to ₹204.75. The stock witnessed stronger demand relative to supply, suggesting underlying confidence in its robust retail banking portfolio and stable NIM outlook.
Overall Market Activity Remains Subdued
The total traded volume for Nifty Bank stocks during the pre-open stood at 4.27 lakh shares, amounting to ₹20.88 crore in turnover. Despite weakness in select names, the total market capitalisation of all 12 constituents held steady at ₹37.37 lakh crore.
This stability comes even as heavyweight counters like HDFC Bank (-0.19%) and Kotak Bank (-0.07%) faced minor selling, likely due to institutional profit-booking ahead of upcoming quarterly results.
What’s Driving Market Sentiment?
The decline in PSU banking stocks signals investor caution driven by rising bond yields and ongoing concerns over government borrowing plans. Meanwhile, private banks remain more insulated, thanks to relatively stronger balance sheets and improving operational metrics.
Moreover, global cues remain uncertain as investors await commentary from the US Federal Reserve regarding the timeline for interest rate cuts. The anticipation of a “higher for longer” rate regime is weighing on rate-sensitive sectors like banking.
Outlook: Watch for Volatility Post-Opening Bell
The pre-open divergence highlights uncertainty in the sector. While PSU banks are under pressure, select private lenders are still seeing interest. Market participants should monitor volume spikes and price action closely once regular trading begins, particularly in SBI, HDFC Bank, and PNB.
Analysts recommend a cautious approach, as volatility may rise during the session. Investors are advised to track macro data and institutional flows closely to assess sectoral direction in the coming days.
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