Nifty Smallcap 100 rallies 5% in 4 sessions, outshines benchmarks

The Nifty Smallcap 100 has surged 5 per cent in the last four trading sessions, significantly outperforming the benchmark Nifty 50, which gained 4.21 per cent during the same period. On November 27, the Nifty Smallcap 100 hit an intraday high of 18,474.35, advancing 1.14 per cent, while the Nifty rose over half a per cent to an intraday high of 24,341.15.

Broader market trends

Foreign Institutional Investors (FIIs) have turned marginal buyers, alleviating concerns of relentless selling, which supported the rally in smallcap and midcap stocks. In contrast to the smallcap index, the Nifty Midcap 100 rose 3.32 per cent during the same period, reflecting broad-based buying in the broader market.

Expert insights

V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, highlighted that easing FII selling has boosted sentiment. “A major market concern from relentless FII selling is receding as they have turned buyers, though marginally,” he said.

Looking ahead, Vijayakumar emphasized the opportunities in select PSU stocks in defence, shipping, power, and railways, which now offer favourable risk-reward prospects following recent corrections.

Challenges and outlook

Despite the strong rally in small and mid-cap indices, the Nifty 50 ended marginally in the red on November 26, reflecting continued headwinds for larger-cap stocks. Market experts warn of potential challenges from evolving global trade policies, including the implications of Donald Trump’s tariff plans.

The divergence between broader markets and benchmarks signals selective opportunities for investors, especially in smallcaps with robust fundamentals and liquidity-sensitive midcaps.