Technical Pick - Buy UCO Bank
PSU Banks have been on a roll and we see almost all stocks are on the buyers radar.
Investors are betting on PSU banks not only because they are beaten down and are trading at lower prices but also because market participants are finding value in them as the economy recovers and NCLT proceedings gather pace. With economic recovery especially in the steel and commodity sector we find that a lot of NPAs have started performing. The broader recovery in the commodity sector has helped beleaguered companies come out of their financial troubles and the improving financial conditions of several companies has raised hopes of recovery in the PSU banks which were worst hit due to increasing NPAs.
UCO bank is one such PSU bank which may benefit from the secular positive trend in the PSU banks. A low price stock, UCO bank made a golden crossover on Friday where we saw the 50 DMA crossing the 200 DMA, thus creating a bullish signal for the counter.
A golden crossover of 50 DMA can be considered a bullish signal for the medium term. UCO bank was trending in the news lately as the board of the bank approved its funds raising plan. The stock has gained nearly 39 per cent on YTD basis while in one year the stock is up by more than 72 per cent.