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PSU Bank Stocks Fall: Several bank stocks came under pressure amid a broad market sell-off on November 21; Here’s why
Banks stocks suffer sharp decline
Several bank stocks came under pressure amid a broad market sell-off on November 21, exacerbated by news of US federal courts alleging bribery charges against Gautam Adani and other group executives, traders said.
Public sector bank stocks saw significant declines on Thursday, with some falling up to 7 per cent. The Nifty PSU index dropped nearly 5 per cent, weighed down by SBI, Bank of Baroda, PNB, and Canara Bank.
SBI shares fell 5 per cent to Rs 761.55, Canara Bank dropped 5.4 per cent to Rs 92.52, PNB slipped 6 per cent to Rs 94.81, and Bank of Baroda led the decline, falling 7.3 per cent to Rs 219.85.
The sharp drop in PSU bank stocks followed news that Gautam Adani, founder and Chairman of the Adani Group, along with other executives, faced bribery charges from US prosecutors. They are accused of allegedly bribing Indian officials with $250 million to secure renewable energy supply contracts in India.
In addition to PSU banks, state-owned financial institutions such as REC (Rs 469.25) and Power Finance Corporation (Rs 433) saw declines of 9% and 8%, respectively.
Adani Green Energy, part of the Adani Group, canceled a $600 million bond issue on Thursday after US prosecutors formally charged Gautam Adani in connection with the alleged bribery scheme.
In a regulatory filing, Adani Green Energy announced that the US Department of Justice (DOJ) and the US Securities and Exchange Commission (SEC) had filed criminal indictments and civil complaints, respectively, in the Eastern District of New York against Gautam Adani, Sagar Adani, and board member Vneet Jaain.
Following these developments, Adani Green Energy stated that its subsidiaries had decided to suspend the planned USD-denominated bond offerings.
Meanwhile, the Indian rupee hit an all-time low on Thursday, pressured by expected foreign outflows from local stocks and a strengthened US dollar, as investors adjusted expectations regarding aggressive rate cuts by the US Federal Reserve.
The rupee fell to a low of 84.4225 during early trading, before stabilizing at 84.4150 as of 9:30 AM IST, unchanged from its previous session’s close.
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