Bank Nifty Falls Below 58,000 as HDFC, Axis, SBI Stocks Slip After Five-Day Rally

Bank Nifty Slips Below Key Support Levels

The Bank Nifty index closed at 57,720, down 0.6 percent, slipping below the trend-deciding level of 58,202, as identified by Axis Securities. Analysts had earlier cautioned that trading below this level could trigger profit booking and short-term correction, with potential support zones at 57,827–57,201.

“The earlier rally was driven by better-than-expected Q2 earnings from major players. With the index dropping below the first support zone, short-term correction is likely,” Axis Securities noted.

PL Capital highlighted the next support near the previous consolidation zone at 57,300, which will be critical for sustaining medium-term bullish momentum. On the upside, potential targets of 59,700 and 60,500 remain in focus if the index rebounds.

Banking Heavyweights See Profit Booking After Q2 Rally

Shares of India’s major banks, HDFC Bank, Axis Bank, and State Bank of India (SBI), declined on Friday, October 24, ending a five-day rally driven by strong second-quarter results.

HDFC Bank and Axis Bank fell 1.3 percent each, closing at ₹995.90 and ₹1,242, respectively, while SBI dropped 0.8 percent to ₹904. The three banks had gained between 2.9 percent and 7.6 percent over the previous five sessions, reflecting investor optimism on robust quarterly earnings.

The decline in these large-cap banking stocks pulled the Bank Nifty index below 58,000, a key psychological and technical level, after hitting a record high of 58,577.50 on October 23.

Also Read : SEBI Prohibits Mutual Funds from Investing in Pre-IPO Placements

Five-Day Gains Eroded Amid Profit Booking

The decline in HDFC Bank, Axis Bank, and SBI marks a temporary pause after a strong performance over the past week:

The gains over the five sessions had been primarily driven by resilient Q2 earnings, which surpassed analyst expectations across private and public sector banks.

Strong Q2 Earnings Support Medium-Term Outlook

The rally in recent sessions was fueled by robust second-quarter results, with analysts highlighting the better-than-expected net interest margins (NIMs) and earnings momentum.

“The decline in NIMs across most banks was lower than expected, suggesting that Q2 may have marked the bottom in earnings growth. Medium-term outlook remains positive with flat growth projected for FY26 and double-digit expansion likely in FY27,” said Nitin Aggarwal of Motilal Oswal Financial Services.

Despite the day’s profit booking, sentiment in the banking sector remains firm, supported by strong valuations, capital adequacy, and continued credit growth.

Sector Sentiment Remains Positive

Analysts believe that the correction in bank stocks is short-term and technical, rather than a reflection of fundamental weakness. HDFC Bank, Axis Bank, and SBI continue to benefit from:

• Strong asset quality with lower-than-expected slippages

• Robust Q2 earnings, beating analyst estimates

• Positive medium-term outlook for credit growth and NIMs

• Healthy capital buffers supporting future expansion

Private sector banks such as Kotak Mahindra Bank, ICICI Bank, and HDFC Bank led the gains in Thursday’s session, contributing to Bank Nifty’s all-time high, while SBI and other public sector banks supported stability in the index.

Technical Analysts Suggest Short-Term Consolidation

Technical analysts suggest that while profit booking is natural after a multi-day rally, the overall trend for banking stocks remains upward for the medium term.

“The Bank Nifty is experiencing a consolidation phase after consecutive gains. Sustaining levels above 57,300 is crucial. On the upside, levels around 59,700–60,500 remain achievable if earnings momentum continues,” said a senior strategist at PL Capital.

Market participants are closely watching quarterly results, credit growth data, and macroeconomic indicators to gauge the next phase of the sectoral trend.

Conclusion: Temporary Pause After Strong Rally

The decline in HDFC Bank, Axis Bank, and SBI on October 24 reflects short-term profit booking following a five-day rally fueled by Q2 earnings.

While the Bank Nifty slipped below 58,000, analysts remain optimistic about the sector’s medium-term prospects, citing strong fundamentals, resilient credit growth, and robust valuations.

• Bank Nifty
• Nifty 50
• Sensex