NIFTY Bank Snapshot: PNB, Federal Bank And IDFC First Bank Among Top Contributors

The NIFTY Bank index traded firm in Monday’s mid-session trade, underpinned by strong contributions from Punjab National Bank (PNB), Federal Bank, and IDFC First Bank. These lenders emerged as the top gainers in the basket, helping offset relatively muted performance from heavyweight peers HDFC Bank and ICICI Bank.

How the Session Unfolded

NIFTY Bank opened on a steady note at around 52,950 levels, tracking positive global cues and stable domestic liquidity conditions. As the morning session progressed, selective buying in mid-tier and PSU lenders lent momentum. By late morning, the index hovered close to the 53,200 mark, with advances in PNB, Federal Bank and IDFC First Bank providing the bulk of the uplift.

Traders noted that the contribution of these three stocks collectively accounted for nearly two-thirds of the positive points on the index. Market participants highlighted that this pattern reflects an ongoing rotation from heavyweights to broader banking names, as investors look for value in relatively under-owned counters.

Company-Wise Moves

Punjab National Bank (PNB):
PNB shares gained nearly 1.8% intraday, supported by robust volumes. Dealers cited steady traction in its retail loan book and improving asset quality trends as key drivers. The bank has also benefited from investor appetite for PSU lenders, with the broader PSU Bank index outperforming NIFTY Bank in recent weeks.
Federal Bank:
Federal Bank added 1.5%, extending gains from last week. Market reports suggested strong traction in deposits and stable credit growth, which reassured investors about the lender’s ability to sustain margins. The mid-cap lender’s consistent performance has positioned it as an attractive alternative to larger private banks.
IDFC First Bank:
Shares of IDFC First Bank rose 1.2%, contributing positively to the index. The stock has seen steady buying interest following upbeat commentary on branch expansion and digital lending growth. Analysts also pointed to improved liability management as a factor supporting sentiment.

Meanwhile, HDFC Bank and ICICI Bank, which collectively hold significant weightage in the index, contributed less to the day’s movement. HDFC Bank slipped around 0.4%, while ICICI Bank edged down 0.3%, both showing muted activity compared to their smaller peers.

By the Numbers

Bank	Intraday Move	Contribution
Punjab National Bank	+1.8%	Strong Positive
Federal Bank	+1.5%	Positive
IDFC First Bank	+1.2%	Positive
HDFC Bank	−0.4%	Muted
ICICI Bank	−0.3%	Muted

Broader Market Context

The gains in NIFTY Bank came against a backdrop of stable bond yields and expectations that the Reserve Bank of India (RBI) will maintain its current monetary stance in the upcoming policy review. A supportive liquidity environment has spurred risk appetite in select banking names, particularly those with improving fundamentals but still trading at attractive valuations.

The PSU banking segment has been a consistent outperformer through 2025, aided by higher credit growth in retail and agricultural lending, government-led recapitalisation assurances, and strong fee income trends. Private sector mid-tier banks like Federal Bank and IDFC First Bank have similarly benefited from institutional inflows, as fund managers diversify beyond the sector’s top two giants.

On the other hand, larger private banks are consolidating after sharp gains earlier in the year. While HDFC Bank and ICICI Bank remain core holdings for institutions, their subdued moves in today’s session reflect a phase of digestion and rotation.

What Analysts Say

Analysts tracking the sector believe that the breadth in banking gains is a healthy sign for the market. According to them, the participation of PSU and mid-tier lenders reduces concentration risk in NIFTY Bank, making the index less vulnerable to short-term volatility in one or two large-cap counters.

Market strategists also pointed out that improving macroeconomic indicators — including higher GST collections and steady industrial growth — support the banking sector’s outlook. With credit demand expected to remain firm in the second half of FY26, lenders with diversified books are seen as better placed to capture the momentum.

Outlook for NIFTY Bank

Technical analysts noted that immediate support lies at 52,800, with resistance around 53,500. Sustained trade above the latter level could pave the way for a move toward 54,000 in the near term. Conversely, a breakdown below 52,800 might trigger short-term profit-taking.

For investors, the index composition today underlined the importance of tracking contributions beyond the top two banks. Stocks like PNB, Federal Bank, and IDFC First Bank may continue to play a pivotal role if institutional flows persist.