Bank stocks rose sharply by up to 9.5 per cent today after the government's decision to withdraw Rs 500 and Rs 1,000 currency notes from circulation in a bid to curb black money and terror funding.
Shares of Bank of Baroda jumped 9.56 per cent, followed by Punjab National Bank (9.19 per cent) and SBI (8.73 per cent) on BSE.
Shares of Canara Bank climbed 6.74 per cent, followed by ICICI Bank (5.91 per cent) and HDFC Bank (1.84 per cent).
"Banking sector is expected to benefit as more money will flow into the formal sector. We expect banks to benefit in terms of more deposits, especially low cost deposits. However, in the near term, banks may witness higher stress on assets in the real estate sector," said Kalmesh Rao, CEO, Kotak Securities.
Banks have been ordered to remain open on the weekend as well as function late till 9 PM for three days beginning today to deal with the huge rush.
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