49 smallcaps deliver double-digit weekly gains in volatile market. What should investors do?

Equity markets were mixed during the week with a steep crash, followed by a recovery as investors continued to buy the dips.

As many as 49 smallcap stocks have delivered double-digit weekly returns with four of them offering over 25% returns.

PC Jeweller was the top gainer in the smallcap pack with nearly 60% return, followed by Salsar Techno (31.6%), Gallantt Ispat (28%), and Sangam (26%).

About 44 stocks, including Hindustan Copper, Shyam Metalics, Astrazeneca, Heritage Foods, MSTC Ltd, among others, have offered returns between 20 and 25% during the week.

In the midcap segment, four stocks including Oil India, Castrol India, IRCTC and Voltas have risen in double digits. While Oil India has gained 15%, Castrol and IRCTC were up just over 10% each.

From the Sensex pack, Nestle India topped the charts with 4% return, followed by Wipro at 3.6% and Reliance Industries at 2.8%.

What should investors do?Analysts said despite premium valuations, the underlying tone of the market remains positive. However, as we enter into the holiday season, the market is likely to remain rangebound.

“Overall the mood of the market remains positive. We expect the market to remain range-bound with stock specific action next week,” said Siddhartha Khemka, head (retail research), Motilal Oswal.

“The short-term positive trend persists, supported by a strong revival in FIIs buying and stock-specific actions. Heading into the festive season and year-end, we can anticipate a range-bound trade scenario with limited data points,” said Vinod Nair, head of research at Geojit Financial Services.

Investors also need to be cautious as certain sectors appear to be in overbought territory, analysts further noted, potentially setting the stage for profit-booking. This could notably impact mid- and small-cap equities.

Technically, Nifty displayed volatile movements on the last day of the week but managed to close above the crucial level of 21,300.

“The lower-end support for the index is positioned at 21,200, presenting a buying opportunity on any dips toward this level. Sustaining above 21,300 could pave the way for further upside momentum, targeting the 21,500 level,” said Kunal Shah of LKP Securities.

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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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