Shares of public sector banks (PSBs) and private banks fell on August 28, 2025, pushing the Nifty Bank index down for the sixth consecutive session. Investors reacted to weak sentiment and technical pressures in the banking sector.
PSU Banks Lead Losses
The Nifty PSU Bank index dropped nearly 0.7%, hovering around 6,803 in the afternoon. Key losers included:
- Punjab & Sind Bank (PSB): down ~2%, trading at Rs 28
- Union Bank of India, Bank of Maharashtra, UCO Bank, Bank of India: down over 1%
- Punjab National Bank (PNB), Canara Bank, Central Bank of India: down ~1%
- Bank of Baroda, SBI, Indian Bank, IOB: marginal losses
The PSU index has fallen nearly 5% over six sessions, reflecting prolonged weakness in the sector.
Private Banks Also Slump
Private lenders joined the downward trend:
- HDFC Bank, ICICI Bank: down over 1%
- AU Small Finance Bank: down nearly 2%
- Kotak Mahindra Bank, IDFC First Bank, Canara Bank, Bank of Baroda: down ~1%
The decline pulled the Nifty Bank index down by nearly 0.9% to 53,969.
Technical Analysis
According to Vaishali Parekh, VP – Technical Research at PL Capital:
- Bank Nifty broke the support level of 55,000, indicating weak sentiment
- Next key support is near 53,500
- For improvement, the index needs to move past the 50 EMA level at 55,700
- Daily trading range: 53,800–55,000
Government Stake Sale Plans
The Indian government has appointed Goldman Sachs as transaction advisor for equity stake sale in four PSBs:
- UCO Bank
- Central Bank of India
- Punjab & Sind Bank
- Indian Overseas Bank (IOB)
The government plans to dilute up to 5% equity in each bank over 2–3 years. This move may influence stock performance in the coming sessions.
Key Takeaways
- PSU and private banks are under selling pressure
- Technical indicators show further potential downside
- Government stake sale plans could affect market sentiment
In summary: Investors should monitor key support levels and government policies as the banking sector continues to show volatility.
