While broader indices are on the decline, these 22 small-cap stocks are delivering impressive double-digit returns
small cap stock: The major indices followed the main indices and continued their downward trend for the second consecutive week, with declines ranging from 0.5-1 percent.
During this week, the BSE Sensex dropped 759.58 points or 0.98 percent to close at 76,619.33, while the Nifty50 index fell by 228.3 points or 0.97 percent to finish at 23,203.20.
In the broader indices, the BSE Mid-cap and BSE Small-cap indices each declined by 1 percent, while the BSE Large-cap index was down by 0.5 percent.
Within the sectors, the Nifty Information Technology index saw a significant drop of nearly 6 percent, Nifty Realty was down by 2.5 percent, and Nifty Healthcare, Media, and FMCG indices all fell by more than 2 percent. On the other hand, Nifty PSU Bank and Metal indices rose by 3 percent each.
Foreign Institutional Investors (FIIs) sold equities worth Rs 25,218.60 crore during the week, while Domestic Institutional Investors (DIIs) bought equities worth Rs 25,151.27 crore. So far this month, FIIs have offloaded equities worth Rs 46,576.06 crore, while DIIs have purchased equities worth Rs 49,367.14 crore.
The Nifty-50 Index and Sensex each experienced a 1% decline in the past week, with the mid-cap and small-cap indices also losing around 1%. Despite decent 3QFY25 earnings from large-cap stocks, market sentiment remained subdued due to rising crude oil prices (+5%) and the continued depreciation of the INR (-0.6%) in the past week, according to Shrikant Chouhan, Head of Equity Research at Kotak Securities.
The BSE Small-cap index took a significant hit, dropping by 6 percent, with stocks like Jai Corp, KEC International, Inox Wind, Skipper, Oriental Rail Infrastructure, Garware Hi-Tech Films, Blue Star, PCBL
Amol Athawale, Vice President of Technical Research at Kotak Securities, analyzes the current market trends:
Based on the daily and intraday charts, the market is showing a lower top formation, indicating potential weakness ahead. Despite this, the market appears oversold, suggesting that level-based trading may be the best strategy for short-term traders.
For bullish investors, key resistance levels are at 23300/76900. Breaking above this could lead to a rally towards 23500/77500, 23590/77800, or the 20-day Simple Moving Average (SMA). Conversely, key support levels are at 23100/76300, with potential drops to 23000/76000 and 22850/75700 if these are breached.
Regarding Bank Nifty, sustained trading below 49200 could signal continued weakness, potentially leading to levels of 48000-47600. However, a break above 49200 could indicate a move towards 49800-50000.
Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, provides insights on Nifty’s weekly chart:
Nifty’s weekly chart shows a small bullish candle with minor upper and lower shadows, forming a doji pattern. This pattern, following a period of weakness, could signal a potential reversal once confirmed.
The short-term trend for Nifty remains weak, with a break above 23400 needed to spark renewed buying interest. Immediate support is at 23100.
Jatin Gedia, Technical Research Analyst at Mirae Asset Sharekhan, offers his perspective on Nifty’s potential movements:
Expectations are for Nifty to decline towards the psychological level of 23000, with further potential drops to 22670. However, a lack of sustained selling pressure could lead to consolidation within the range of 23100-23300.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.