Bank Nifty Extends Gains for Second Straight Day on Optimism Over Middle East Peace Developments

Bank Nifty Extends Gains for Second Straight Session

Bank Nifty rose 2 percent on Wednesday, extending its gains for a second consecutive session, driven by value buying in banking shares. The index had fallen over 7 percent in the previous three sessions before rebounding on Tuesday.

HDFC Bank led the charge, rising 2.1 percent following the lender's decision to tap external law firms to review the former chairman's resignation. AU Small Finance Bank emerged as the top gainer in the index, increasing 3.44 percent to Rs 907.7 per share on the NSE. Union Bank of India and IndusInd Bank also advanced, gaining 3.1 percent and 3.94 percent, respectively.

Market sentiment improved following reports of easing tensions between the US and Iran, including a proposed ceasefire, which led to a cooling in crude oil prices from elevated levels. This development eased concerns around inflation and global economic stability, triggering short covering and fresh buying in equities.

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Technical Analysis

According to Aakash Shah, Technical Research Analyst at Choice Equity Broking, support is seen around 53,700–53,800, while resistance lies in the 54,300–54,400 range. The RSI at 31.37 indicates the index is nearing oversold levels. Sudeep Shah, Head of Technical and Derivatives Research at SBI Securities, stated that the 53,000–53,100 zone will act as immediate resistance for the index, with a sustained move above 53,100 potentially extending the pullback rally towards 53,600 in the near term. On the downside, the 52,200–52,100 zone is a crucial support region for Bank Nifty.