Indian Mid and Small-Cap Indices Skyrocket Over 4% Amid India-Pakistan Ceasefire and Sino-US Trade Deal

The midcap and smallcap sectors saw a strong boost on May 12, with the Nifty Midcap and Nifty Smallcap indices climbing 4%. This uptick mirrors the broader market rally, driven by easing geopolitical tensions between India and Pakistan, and a promising US-China trade deal.

In late afternoon trading, the Nifty Midcap 100 index reached 55,416, up 4.1%. Rail Vikas Nigam (RVNL) led the gains, soaring nearly 10% to Rs 354. Other notable performers included Steel Authority of India (SAIL) and Persistent Systems, both up over 8%. Companies like Coforge, Suzlon Energy, and BHEL saw increases of more than 7.5%, with Godrej Properties, HUDCO, and NHPC also experiencing gains of over 7%.

The Nifty Smallcap 100 index was not to be outdone, standing at 16,770, up 4.3%. JBM Auto took the lead with a nearly 12% jump to Rs 693, while HFCL surged nearly 10% to Rs 81.47. Other smallcap stocks like Hindustan Copper, First Cry, and Inox Wind also reported significant gains.

The recent agreement between India and Pakistan, announced on May 10, to cease military actions has positively influenced investor sentiment. This development follows increased tensions after India targeted terror sites in Pakistan on May 7. Prashanth Tapse, Senior VP of Research at Mehta Equities, noted that such de-escalations typically have favorable effects on the markets.

On the global front, trade negotiations between the US and China have also calmed investor nerves. Officials from both countries held talks in Switzerland, leading to a temporary pause in tariffs. The US plans to reduce tariffs on Chinese goods from 145% to 30%, while China will decrease tariffs on US goods from 125% to 10%, effective from May 14 for 90 days.

The cumulative impact of these geopolitical easings has propelled the Sensex, which surged over 2,800 points to reach 82,273. Concurrently, the Nifty soared around 4%, touching approximately 24,885.

Looking back, markets have historically responded positively to such geopolitical reductions. As investor confidence grows, so does the potential for sustained growth in the midcap and smallcap sectors.

For continuous updates on market trends and investment insights, it’s essential to consult with certified financial experts.

For more information about current market trends, visit Moneycontrol.

Source link