More than 400 small-caps gain 10-102% as market surges in April

Amid volatile global markets, the Indian indices put a good show in the week ended April 28 and also added 4 percent in the month of April, the best in 5 months, helping Nifty to close above the 18,000 mark.

In this week, BSE Sensex added 1457.38 points or 2.44 percent to close at 61,112.44, while Nifty50 gained 440.95 points or 2.50 percent to finish at 18,065.

For the week, BSE Midcap, Smallcap and Largecap index rose 2.5 percent each.

“Global equity markets remained volatile amid worries about slowdown in global growth. Domestic equity markets showed strength and ended the week positively. Sensex 30 and Nifty 50 moved higher by ~2% this week. Overall breadth of the market was positive with BSE Midcap, BSE Smallcap and most of the sectoral indices closing the week with positive returns,” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

“With the results season underway, stocks continue to react to their Q4FY23 performance. Crude oil price corrected this week with Brent Crude trading below the USD 80 per barrel mark. Markets in the near term will focus on the upcoming Federal Reserve meeting and the ongoing Q4FY23 financial results,” Chouhan added.

All the sectoral indices ended in the green with Nifty PSU Bank index added 7.3 percent, Realty up 5 percent, Infra index up 3.6 percent and Information Technology up 3.3 percent.

Monthly Performance

BSE Sensex rose 3.6 percent and Nifty added 4 percent. BSE Smallcap, Midcap and Large cap indices added 7 percent, 5 percent and 4 percent, respectively.

In the month of April, around 20 smallcap stocks added between 40-102 percent including Future Consumer, Bombay Dyeing, Tanfac Industries, Rail Vikas Nigam, Vinyl Chemicals (India) and Aarti Surfactants.

On the other hand, Radhe Developers (India), Brightcom Group, MPS, Optiemus Infracom, Orient Electric, EKI Energy Services, Archean Chemical Industries, Vadilal Industries, AAVAS Financiers, MAS Financial Services, Kriti Industries (India), Zen Technologies, Kirloskar Ferrous Industries, Ahluwalia Contracts India and Asian Energy Services lost between 10-36 percent.

“Domestic equities are continuously gaining strength for the last five days supported by healthy Q4 earnings, declining VIX and FIIs turning positive. Nifty showed resilience despite global headwinds gaining over 4 percent in April – the best in 5 months and managing to close above the crucial 18,000 mark,” said Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services

“We expect this momentum to continue and expect Nifty to head towards 18,200 zones. Next week would be crucial as US Fed and ECB policy meetings are lined – up. Apart from this, PMI data from US, China and India would also be keenly watched. On the domestic front, markets will remain closed on Monday. Investors would continue to track Q4 results along with global cues and Auto monthly sales data,” he added.

The Foreign institutional investors (FIIs) turned buyers in the week ended April 28 as they bought equities worth Rs 5,395.13 crore and domestic institutional investors (DIIs) bought equities worth Rs 1,874.25 crore.

In the month of April, FIIs bought equities worth Rs 5,711.80 crore and DIIs bought equities worth Rs 2,216.57 crore.

Where is Nifty50 headed?

Amol Athawale, Technical Analyst (DVP), Kotak Securities

Technically, the Nifty took support near the 200-day SMA or 17,650 (Simple Moving Average) and bounced back sharply. It has also formed a long bullish candle on weekly charts which is largely positive. As long as the index is trading above 17,900 the uptrend formation is likely to continue and could move up to 18,150-18,250. On the flip side, below 17,900, traders may prefer to exit from the long positions.

Meanwhile, Bank Nifty is holding a higher bottom formation, and hence we may see some profit booking at higher levels. In the near future, 42,800-42,500 would be the strong support zone while 43,700-44,000 could act as an important resistance zone for the traders.

Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas:

As long as the Nifty continues to trade above 17,800 – 17,780 support zone, we expect the positive momentum to continue.

Overall, the positive outlook remains intact and a close above 18,100 shall lead to a further upside till 18,370 where resistance in the form of the weekly upper Bollinger band is placed.

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