It would rank Yes Bank among 45 stocks newly added in the much-awaited futures and options space at the National Stock Exchange, as most of these entrants now go into F&O for the first time. A four-year gap would only mean that this is an event worth returning into this particular segment after a so long hiatus.
The lender was barred from F&O trades in May 2020 as the bank was affected by a severe financial crunch. In that time period, Reserve Bank of India had issued a moratorium, deposited withdrawal capped to ₹50,000 for an account, and superseded its board. These events have set off shock waves across financial markets; hence, it is time for Yes Bank to bid farewell to F&O trades.
Yes Bank’s Stock Journey: From Decline to Resurgence
Yes Bank’s stock performance has witnessed a rollercoaster curve over the last few years. The stock was down by 62% from 2020, and then in 2021, it was again down by 23% as it reflected the strain on the bank‘s books. However, 2022 became a turning point as the stock rose by 50% with stabilization efforts and investor confidence in the bank’s recovery strategy.
In 2023, momentum of the stock has decelerated with a modest 4% under subdued market conditions. The share has traded in a mixed trend of gains and losses thus far in 2024. It is now trading with losses of more than 1% so far during Friday‘s session.
It showed signs of growth in confidence in operations despite pretty uninspiring performance during 2024. Going back to the F&O segment is a pointer toward the potential of bringing interest from traders in the derivatives market.
What does the F&O Return signify for Yes Bank?
One notable development was the return of Yes Bank into the F&O segment. Traders can now trade in futures and options contracts involving Yes Bank stock, so they can now speculate as well as hedge. To the bank, it shows partial restoration of its market standing and, by it, a signal of the regulator that the financial health is improving.
Besides enhancing the liquidity and price discovery of stocks, F&O trading can also positively impact Yes Bank‘s market dynamics. However, considering the volatility in the history of this lender, market participants would stay cautious as they assess the trajectory of this lender.
2024 – A Mixed Bag for Yes Bank Stocks
Yes Bank’s stock performance this year has been less dynamic compared to its recovery phase in 2022. Several factors have contributed to this, including fluctuating market sentiment, sector-specific challenges, and cautious investor outlook.
Shares of Yes Bank traded in a relatively muted space today, reflecting the general trends followed by the banking stock so far. It witnessed significant selling pressure on the two consecutive trading sessions too. Share price declined over 1% on Friday.
Road Ahead for Yes Bank
Entry back into the F&O segment is quite significant as Yes Bank enters its quest to regain brand recognition within the financial services marketplace. The bank indeed has experienced a long time since 2020 as far as the crisis issue was concerned. However, difficulties persist:.
Analysts believe that the F&O performance of Yes Bank would depend more on the sustainability of constant financial results and institutional demand. Other key factors about the future of the shares would depend on the strategies adopted by the bank: strengthening the balance sheet, non-performing assets reduction and digital transformation.
Conclusion: Yes Bank’s return to the F&O segment after four years is a testament to its efforts to regain investor trust and improve financial stability. While the stock has shown mixed performance in 2024, this milestone highlights the bank’s progress since its crisis days. As regards to trading, the new entry by Yes Bank into the derivatives market opens up a new venue for hedging and speculating. Its volatile past, however, is bound to keep its operational and financial developments of the future months under closer watch of the market players.
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