Don't buy the bounce — Deepak Shenoy says wait for earnings commentary before calling the all-clear

The banking sector is under scrutiny for asset quality and credit growth, with recent reports indicating both positive and negative trends. Investors are looking for clarity on NIMs and deposit pricing.

Focus on private banks and NBFCs exhibiting strong secured loan books and favorable NIM trends; maintain a cautious stance on other financial segments.

For Indian markets, this story mainly matters for the Financials, Banking, NBFCs pocket. The current signal is mixed, so traders should watch whether the effect spreads across the sector or stays limited to a single name.

Watch whether the market validates this read through price action, volume, and breadth. If the headline matters, the signal should show up in execution, not just in commentary.

• •Deepak Shenoy urges caution, advising not to 'buy the bounce' based on ceasefire hopes.
• •He suggests waiting for earnings commentary before calling the 'all-clear' for the market.
• •Shenoy sees selective opportunity in private financials, specifically banks and NBFCs with strong secured loan books.
• •He warns that most retail stocks remain overvalued despite recent drops.
• •Risk flag: Potential for asset quality deterioration in unsecured loan books.