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[hfe_template id='11223'] [ad_1] The tide is turning against India’s smaller companies as weak earnings and a souring economic outlook spur a downturn in their shares. Key gauges of small- and mid-sized companies have tumbled since hitting September highs, putting them close to a so-called technical correction of a 10% peak-to-trough decline. The Nifty Midcap 100 Index is heading for its biggest monthly drop since the pandemic, tracking losses in the broader market, while the Nifty Smallcap 250 Index is set to fall the most in more than two years. The meltdown in October, a sharp reversal from a searing rally in such stocks in the previous months, reflects wavering investor sentiment due to cooling earnings momentum. Despite the selloff, the stocks are still trading at high valuations, signaling investors may book profits and chase rallies in other markets such as China. Bloomberg “Many of high beta stocks in this segment were trading at frothy valuations and are typica...

[hfe_template id='11223'] [ad_1] A blistering rally in mid-cap stocks is on course to enter correction territory, as investors become increasingly concerned over slowing earnings growth and elevated valuations. The Nifty Midcap 100 tumbled as much as 2.9% Friday, extending its drop from recent high to more than 10% — the parameter for a so-called technical correction. Heavy selling by foreign portfolio managers this month fueled the downturn in the index, which had rallied about 30% through September 23. The rapid change in fortunes for Indian stocks came as a rally in Chinese shares gathered steam, following a central bank stimulus blitz in late September that sparked a frenzy of buying. Slowing earnings growth in India also weighed on sentiment. Bloomberg While foreign investors have soured on local shares, domestic institutions have poured in billions to absorb their selling. Stock Trading Markets 102: Mastering Sentiment Indicators for Swing and Positional Trading By...

[hfe_template id='11223'] [ad_1] The Nifty Midcap 100 Index has recently hit an unprecedented high of 60,400 driven more by market forces than by robust corporate fundamentals. Currently, the index trades at a Price-to-Earnings (P/E) ratio above 44 — the highest level since the post-pandemic surge in midcap stocks. This P/E multiple is significantly above its 5-year and 10-year median levels, by approximately 75% and 54%, respectively, signalling that midcap stocks are trading at a considerable premium. These inflated valuations raise concerns about an impending market correction. Historically, when the Nifty Midcap 100 has experienced a sharp decline of 10% or more in a single month, the Nifty 50 has consistently outperformed both the Nifty Midcap 100 and Nifty Smallcap 100 indices. Statistical data shows that when the Nifty Midcap 100 rallies more than 15% over four months and subsequently corrects, the Nifty 50 has a higher probability of outperforming both the Midcap...