In a reversal of upward trajectory after several months, the BSE small- and mid-cap indices were hit hard on Tuesday as they fell as much as 2% on profits recorded by investors.
The benchmark BSE 30-stock index outperformed the broader market, gaining 151.81 points or 0.28% on Tuesday.
“Mid and small cap stocks continued to bleed as profit taking followed a strong rally over the past 2-3 months,” said Siddhartha Khemka, head of retail research at Motilal Oswal Financial Services. ltd.
In the small cap index, Jindal Poly Films plunged 11.62%, Ambika Cotton Mills fell 10.15%, Hindustan Oil Exploration Company fell 9.99% and Mcleod Russel India Ltd fell 9. .88%.
The small cap index closed at 26,065.95 points, down 545.72 points or 2.05%.
“What started as a selloff in metal stocks today triggered a selloff in the small cap index after a months-long rally,” said S Ranganathan, head of research at LKP Securities.
A strong rebound in mid- and small-cap stocks in recent months has prompted investors to take profits, said Binod Modi, head of strategy at Reliance Securities.
In Tuesday’s trade, the mid-cap index closed 194.54 points or 0.85% lower at 22,762.05 points.
Among mid-cap stocks, KIOCL fell 5.47%, National Aluminum Company fell 5.32%, Steel Authority of India Ltd fell 5.18% and JSW Energy lost 5%.
The small cap index had hit an all-time high of 27,323.18 points on August 4 this year. The midcap index had also hit its all-time high of 23,478.8 points on the same day.
So far this year, the small cap index has gained 7,967.84 points or 44% while the mid cap index has gained 4,820.62 points or 26.86%.
The BSE benchmark has jumped 6,803.33 points or 14.24% so far this year.
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