Mid And Small Caps Take A Bigger Tumble On Border Tensions

Mid and small cap stocks fell twice as heavily in a market that saw red splashed all over on news of surgical attacks across the borders. The Nifty Mid and Nifty Small Cap indices tumbled 3.8 and 5.8 per cent respectively as most retail buyers shied away from the markets. The frontline Nifty lost 1.64 per cent by comparison.

Stock market reactions were swift and fast as the frontline indices tumbled over 500 points in quick time. However, emergence of some buying towards the end of the session saw markets pull back marginally to finally close at 465.28 or -1.64 per cent lower on the Sensex.

Small- and mid-cap stocks saw heavy selling as buyers were conspicuous by their absence. Ninety six stocks in the Mid-cap 100 saw losses ranging from -0.27 per cent to over 11 per cent. Some of the big losers were Reliance Communications, Sintex Industries and DLF which lost 11.5, 10.7 & 10.22 per cent respectively.

But it was not all red. A few stocks like Gujarat State Petro and Shree Cements managed to buck the trend posting gains of 1.7 and 0.98 per cent respectively as their stocks traded higher at Rs 151.20 and Rs 16,998.90.

The Nifty Small-Cap 100 also lost 5.81 per cent and closed at 5995.55 points. Here again, ninety seven stocks lost up to nearly 11 per cent as investors heavily dumped stocks on worries that the border tensions could escalate. The big losers among the small-cap stocks were Marksans Pharma and Radico Khaitan losing -10.3 per cent (Rs 49.2) and -10.66 per cent (Rs 112.35).

Among the sectors that lost heavily were realty stocks. The NSE Realty index lost 6.98 per cent as stocks like DLF and Indiabulls Realty lost -10.22 per cent (Rs 140.05) and -9.43 per cent (Rs 84.95). The realty sector was beginning to look up over the last few weeks as investors were bottom fishing in this sector.

PSU Banks were among the other notable losers. This sector too had recovered from its lows hit in early March. Both realty and PSU bank stocks are among the high beta stocks that tend to rise or fall higher than market.

Mid- and small-caps could remain volatile if news on the cross-border tensions are showing signs of escalating. Trading volumes tend to reduce in small counters quickly, and hence investors could slow down their purchases till further clarity emerges.