Avoid PSU banking stocks; rupee can hit 65: Anil Manghnani

Shares of public sector undertaking (PSU) banks are under pressure, falling up to 7% on the bourses ahead of the finance minister P Chidambaram meeting with banking heads today. What should you do with these stocks now?

Smartinvestor : The markets have lost ground yet again in trade today with the benchmark indices sliding nearly 1.5%. What are the key trends you are picking up right now?

Anil Manghnani : I think the main problem remains lack of participation of broader market. If one looks at the 2-3 day pull back in the nifty and sensex it was mailnly two stocks - ONGC and RIL.

Anil Manghnani : What was most disappointing was the bank nifty, which was the strongest in the move to 6200, barely rallied in those 3 days and did not even do a 38.2 percent retracement.

Anil Manghnani : The follow up selling in PSU banks today is a major concern..many stocks have broken their lows done last week when the nifty was sub 5600. For the Nifty, the key support is at 5735-5695 which is the .50 and .618 fib supports and also the gap area of last friday so its important we hold this range

Anil Manghnani : Also, the INR needs to hold 60-61 range, as above 61 the next level is 65

Smartinvestor : Talking about banks, stocks such as BoB, SBI, and PNB are among the worst hit among the Nifty pack. What's your advice to investors regarding the banking counters and these three stocks in particular?


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