SmallCaps Outperform Benchmark Indices, Decoding Market Last Week: Recap

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SmallCaps Outperform Benchmark Indices, Decoding Market Last Week: Recap

By Malvika Gurung

Investing.com -- The domestic market closed the June 9-ended week with marginal gains following the Reserve Bank of India’s Monetary Policy Committee (MPC) decision to pause the benchmark interest rate for the second time in a row this week and mixed global cues.

Read Also: RBI MPC Leaves Repo Rate Unchanged at 6.5%, Holds Accommodation Withdrawal

Benchmark indices ended lower for the second consecutive session on Friday, with Nifty50 ending 0.38% lower at 18,563.4 levels and Sensex slashing 223.01 points or 0.35% on June 9.

For the week, the indices managed to add 0.16% and 0.13%, respectively. Broader market indices outperformed the headlines in the week ended on June 9, 2023.

NIFTY Smallcap 100 trumped the market indices, jumping 1.17% during the week, while the Nifty Midcap 150 index zoomed 0.86%. The broadest market index Nifty 500 gained 0.42% last week.

The domestic market started the week on a positive note, buoyed by favourable indicators like stronger-than-expected PMI figures, sequential growth in auto sales, and robust expansion in bank credit. These factors instilled confidence in investors regarding India's growth prospects.

There was also optimism surrounding the anticipation of a positive revision in the RBI’s inflation forecast during the MPC, considering the recent easing of inflation, stated Dr VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services, in a note provided to Investing.com.

However, market sentiment was dampened as the RBI opted for a cautious approach by refraining from a significant cut in the inflation forecast.

“The central bank cited concerns over geopolitical uncertainties, the potential impact of El Nino, and the rise in the minimum support price while reaffirming their commitment to bringing down inflation to near the targeted 4%”, he stated.

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