Bond yield falls under 6% on RBI plan to buy additional G-Secs …Positive for PSU Banks …

· The RBI's decision on Wednesday to step up purchase of government securities (G-Secs) under the G-SAP led to the yield on the benchmark 10-year bond falling below 6 per cent. This signals that the market expects the Reserve Bank of India (RBI) to ensure that interest rate in the economy will continue to be moderate in order to help support economic activity and the elevated borrowing programme of the government.

· The RBI's decision to buy Rs 35,000 crore worth of bonds in May would help the market in absorbing a portion of the Rs1.16 lakh crore of market borrowings by government during the month.

· Expects positive for PSU Banks on account of fall in 10-year G-Sec Yield. SBI is our top pick among the PSU Banking space. Bank of Baroda, Canara Bank, PNB will be positive. #NIFTYBANK #MacroEconomy