Banking and financial stocks rallied sharply on Thursday, November 5, outperforming the broader market as investors cheered Democrats' victory in the US midterm elections, renewed foreign investor buying and a steep decline in crude oil prices.
The election outcome raised hopes of reduced geopolitical tensions and potentially lower trade uncertainty, while Brent crude's slide to a two-month low provided additional relief to the oil-import-dependent Indian economy.
The Nifty Financial Services index surged nearly 3% intraday, while the Nifty Bank index advanced 2.2%, outperforming the Nifty 50, which gained nearly 2%. The rally reflected improving investor appetite for financial stocks amid a broader recovery in domestic equities.
Buying was broad-based across banking and financial stocks, with all constituents of the Nifty Bank index trading in positive territory.
Among financial stocks, SBI Cards led the gains, rising over 6%. Shriram Finance, Cholamandalam Investment and Finance Company, Bajaj Finance and HDFC AMC also advanced over 5% each. Muthoot Finance gained 4.5%, while Bajaj Finserv, ICICI Prudential Life Insurance, REC and LIC Housing Finance rose over 2% each.