More than 50 smallcaps rise between 10-34% as broader indices outperform

Market This Week

The Indian broader indices continued the outperformance in the truncated week with BSE Smallcap index rising 1 percent, while BSE Mid and Largecap gaining 0.3 percent each.

However, BSE Sensex index added 112.09 points or 0.13 percent at 85041.45, while Nifty50 index rose 75.09 points or 0.29 percent at 26,042.30.

Among sectors, Nifty Defence index rose more than 3 percent, Nifty Metal index up 2.7 percent, Nifty Media gained 1 percent, however, Nifty PSU Bank shed nearly 1 percent, Nifty IT and Nifty Pharma declined 0.3% each.

Foreign Institutional Investors (FIIs) continued their selling trend in the Indian equity markets during the truncated final week of 2025, offloading equities worth Rs 4,290.96 crore. In contrast, Domestic Institutional Investors (DIIs) provided crucial support by remaining net buyers, purchasing equities worth Rs 12,024.49 crore.

"Indian equity markets ended the week in a positive terrain, buoyed by expectations of stronger domestic demand, a favourable liquidity outlook, and optimism over potential Fed policy easing in 2026. The holiday-shortened week opened with a bullish undertone; however, momentum tapered off as the days progressed. The year-end lull kept trading largely range-bound, with hopes for a Santa Claus rally diminishing amid the absence of fresh catalysts, limited progress in US-India trade talks, and caution ahead of the upcoming earnings season. Sectoral trends were mixed, marked by selective profit booking across most segments, while metals, FMCG, and media stocks offered notable resilience," said Vinod Nair, Head of Research, Geojit Investments.

"Globally, elevated Japanese bond yields tempered risk appetite, even as robust U.S. GDP figures underscored the resilience of the world’s largest economy. On the domestic front, RBI’s liquidity interventions, such as open market operations and a USD/INR buy–sell swap, helped stabilize the rupee, though persistent FII outflows continued to weigh on sentiment. Meanwhile, gold advanced on safe-haven demand, while crude prices hovered near multi-year lows, though U.S. steps to tighten pressure on Venezuelan oil shipments could exert upward pressure in the near term."

"Looking ahead, market sentiment is likely to stay cautious as investors brace for the upcoming earnings season while remaining attuned to global developments and currency movements. Key drivers will include progress in India–U.S. trade talks, rupee stability, FII trends, and movements in commodity prices. With year-end trading volumes expected to remain subdued, price action could be largely contained. Attention will also turn to next week’s data releases, including India’s industrial and manufacturing output figures, manufacturing PMI, and the U.S. FOMC minutes," he added.

The BSE Small-cap index added 1 percent with KR Rail Enginerring, Jupiter Wagons, Sasken Technologies, Hindustan Copper, KNR Constructions, Steel Exchange India, Ceinsys Tech, Kothari Industrial Corporation, Deccan Gold Mines rising 21-34 percent, while Lloyds Enterprises, Shoppers Stop, Ecos India Mobility & Hospitality, Embassy Developments, Indo Thai Securities, Epigral, Cigniti Technologies.

Where is Nifty50 headed?

Amol Athawale, VP Technical Research, Kotak Securities

We are of the view that the short-term market texture is weak, but a fresh sell-off is possible only after the dismissal of 26,000/85000 or the 20-day SMA (Simple Moving Average). Below this, the market could retest the level of the 50-day SMA or 25,900/84700. Further downside may continue, potentially dragging the index to 25,800/84300. On the upside, a move above 26,200/85600 could lead to a bounce back towards 26,250–26,350/85800-86100.

For Bank Nifty, as long as it remains below the 20-day SMA of 59,300, the weak sentiment is likely to continue. Below this level, it could decline to 58,500–58,300. On the higher side, a move above 59,300 could push it up to 59,800–60,000.

Rajesh Bhosale, Equity Technical Analyst, Angel One

Traders are advised to avoid getting swayed by short-term noise and instead adopt a buy-on-dips approach while booking profits near higher levels. On the downside, immediate support is placed around 25900, while 25700 remains a sacrosanct level for the near-term trend. On the upside, the 26250–26350 zone stands out as a key hurdle, beyond which Nifty could fresh leg of momentum in the uncharted territory. Traders should keep a close tab on these levels and align their trades accordingly.

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