Nifty Bank index jumped 3.45 per cent to 57,847, with all index constituents in the green. Nifty Financial Services, meanwhile, zoomed 4.24 per cent to 26,667.

Bank Nifty Today: Know reasons behind the Rise

SI Reporter New Delhi

Listen to This Article

The banking and financial services stocks were among the biggest movers on Dalal Street on Thursday, helped by multiple factors, including the ease in bond yields on the back of an oil price plunge, easing inflationary fears, and steady buying by foreign investors over the last few sessions.

Nifty Bank index jumped 3.45 per cent to 57,847 today, with all index constituents in the green. IndusInd Bank and ICICI Bank emerged as top gainers, rallying over 5 per cent each. AU SFB, Axis Bank, IDFC First, Punjab National Bank, HDFC Bank and State Bank of India (SBI) gained 3-4 per cent.

Nifty Financial Services, meanwhile, zoomed 4.24 per cent to 26,667, with NBFC Bajaj Finance topping the leaders' board on the back of a 7.5 per cent rise. Chola Finance and Shriram Finance were other top gainers, rising nearly 7 per cent each.

BSE, on the back of strong earnings momentum, gained over 6 per cent, and SBI Card rose 5 per cent. All 20 index constituents traded in the green at the time of writing this report.

What's driving gains in BFSI stocks?

Easing bond yields have been a key factor. They are generally supportive of bank stocks, signalling easing inflation and interest rates, and reducing the cost of borrowing.

India 10-year bond yields have declined from 7.4 per cent last week to a low of 7.06 per cent currently amid easing crude oil prices. Last evening, a Democratic sweep in the midterms raised hopes of an end to the US-Iran conflict and pulled oil prices nearly 10 per cent lower to below $95 a barrel. On Thursday, too, crude traded with minor losses and sustained below the said level.

Kranthi Bathini of Wealthmills Securities said that the recent decline in crude oil prices could help moderate inflation, which could influence the monetary policy outlook.

"If crude prices remain lower, central banks may have greater room to reconsider their stance on interest rates, which could be positive for the sector over the longer term," said Bathini. Higher inflation has prompted central bankers globally, including in India, to raise rates.

The Reserve Bank of India (RBI) last month raised rates by 25 bps for the first time in nearly four years. Higher rates can raise banks' funding costs, slow loan growth and increase credit risk, weighing on profitability and stock valuations.

Other rate-sensitive indices such as Nifty Realty and Nifty Auto also rallied 3 per cent and 4 per cent, respectively.

Additionally, he noted, the valuations in banking and financial services stocks look attractive from a long-term perspective. With foreign investors also showing signs of turning buyers over the past few weeks, the banking sector could see further traction, Bathini opined.

Disclaimer: Views and outlook in this report belong to the brokerages and analysts cited. They do not reflect the views of Business Standard. Readers are advised to exercise discretion.

Don't miss the most important news and views of the day. Get them on our Telegram channel

First Published: Nov 05 2026 | 3:04 PM IST