Smallcaps slip 10-30% as broader indices underperform

For the week, the BSE Sensex gained 669.14 points, or 0.79 percent, to close at 85,231.92, while the Nifty50 rose 158.1 points, or 0.61 percent, to end at 26,068.15.

Broader indices saw profit booking in the week ended November 21 and lagged the headline benchmarks, with the midcap and smallcap indices slipping 1-2 percent. The weakness came amid a global selloff after strong US job additions dimmed hopes of a December Fed rate cut, the rupee hit a record low, and uncertainty persisted over the US-India trade deal.

For the week, the BSE Sensex gained 669.14 points, or 0.79 percent, to close at 85,231.92, while the Nifty50 rose 158.1 points, or 0.61 percent, to end at 26,068.15.

Foreign institutional investors (FIIs) pared their selling, offloading equities worth ₹188 crore. Domestic institutional investors (DIIs) remained strong buyers, pumping in ₹12,969.03 crore.

Among sectors, the Nifty IT index climbed 1.6 percent, the Nifty Auto gained 1 percent, and the Nifty Bank rose 0.6 percent. On the downside, Nifty Realty slid 3.7 percent, Nifty Metal fell 3.3 percent, and Nifty Media dropped 2.4 percent.

"Bullish sentiment continued through the week, supported by stronger Q2 earnings, easing inflation, and optimism around India–US trade negotiations. A moderation in FII selling—driven by expectations of earnings upgrades in H2FY26—also aided the valuations. However, markets turned volatile on Friday amid weak global cues and rising concerns over potential delays in the India–US trade talks," said Vinod Nair, Head of Research, Geojit Investments.

"A better-than-expected non-farm payroll scaled back expectations of a December FED rate cut, which impacted the global equities. The ripple effect seen in haven assets like gold witnessed selling pressure while INR declined to a new low. The oil prices declined due to the US's renewed push for a Russia-Ukraine peace proposal."

"The market may witness some profit booking in the near term if the pressure on INR persists. In the week ahead, investors will also have a close vigil on trade developments and economic data like IIP and Q2FY26 GDP data to get the market direction," he added.

The BSE Small-cap index declined 2 percent, with Fischer Medical Ventures, Spectrum Electrical Industries, RIR Power Electronics, Jai Balaji Industries, Websol Energy System, Deccan Cements falling between 15-30 percent, while gainers were Astec Lifesciences, Sri Adhikari Brothers Television, VLS Finance, 5paisa Capital, VL E-Governance and IT Solutions, and Narayana Hrudayalaya.

We expect markets to remain firm next week, supported by buying on dips, improving demand outlook in Q3 and resilient flows. Any progress on the India-US trade talks would be a key short-term catalyst for the markets.

A sustained move above 26,250 could drive the index towards 26,500. On the downside, the 26,000–25,850 zone is expected to act as strong support for the index.

Traders are advised to stay focused on sectoral rotation, with auto and banking themes likely to remain in favour, while maintaining a stock-specific and risk-managed approach.

Going ahead, one must remain vigilant to any global developments that are likely to act as a catalyst for our markets. Furthermore, given the expected volatility associated with contract expiry, it is advisable to adopt a pragmatic approach that emphasizes robust risk management in the current environment.

Additionally, the strategy of purchasing during market dips has demonstrated efficacy in recent times, and it is essential to sustain this approach moving forward.