PSU banks lead rally on valuations, stabilising assets

The Sensex hit another record closing high today, and is just 42.25 points away from its lifetime intraday high.

Shares of state-owned banks rallied today on hopes of stabilising asset quality and on valuations seen as attractive, said analysts.

Bank of India Ltd shares surged 21.5 percent after its July-September net non-performing loans ratio fell to 1.85 percent at quarter-end versus 2.04 percent a year earlier.

Among other banks, Bank of Baroda jumped 10.6 percent, Punjab National Bank gained 8.9 percent, while State Bank of India was up 4.4 percent.

The Nifty closed at highest level since November 9, 2010. The index ended at 6,299.15, up 47.45 points or 0.76 per cent. It is now 57.95 points away from its lifetime intraday high.

Continued foreign buying has helped lift shares. Overseas investors were net buyers for a 19th consecutive session on Wednesday, bringing their total buying to nearly Rs 16000 crore during that period.

Agencies