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Bank stocks surge up to 6% as Moody's ups India rating
Bank stocks today rose by up to 6
per cent after the US-based Moody's upgraded India's sovereign
credit rating by a notch to 'Baa2' with a stable outlook.
Shares of PNB surged 6 per cent, Bank of Baroda soared
5.17 per cent, Yes Bank gained 4.16 per cent, SBI (3.91 per
cent) and ICICI Bank (3.55 per cent) on BSE.
The scrip of Axis Bank gained 2.64 per cent and HDFC Bank
went up by 1.18 per cent.
The BSE bank index also rose by 1.90 per cent to trade at
The broader market also cheered the news as the BSE
Sensex jumped 331.72 points to trade at 33,438.54.
"Moody's upgrade comes as a welcome move in the wake of
slew of structural reforms in the economy which are expected
to enhance the potential growth in the medium term," said
Upasna Bhardwaj, Senior Economist, Kotak Mahindra Bank.
Moody s Investors Service today upgraded India's
sovereign credit rating by a notch to 'Baa2' with a stable
outlook citing improved growth prospects driven by economic
and institutional reforms.
"The decision to upgrade the ratings is underpinned by
Moody's expectation that continued progress on economic and
institutional reforms will, over time, enhance India's high
growth potential and its large and stable financing base for
government debt and will likely contribute to a gradual
decline in the general government debt burden over the medium
term," Moody s said in a statement.
Sovereign rating is a barometer of the country's
investment climate. It gives investors insight into the level
of risks associated with investing in a particular country and
also includes political risks.
For long, India was rated by other rating agencies at
Baa3, the lowest investment grade and just a notch above the
junk grade, which has now been upgraded a notch higher by
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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