In bear grip! Nifty Smallcap 250, Nifty Next 50 down over 20% from peak
Nifty Next 50 and Nifty Smallcap 250 equity indices have entered bear market territory, marked by declines exceeding 20% from their 52-week highs. The Nifty Next 50 index, which tracks 50 companies just below the Nifty 50, has plunged over 22% from its peak, while the NSE Nifty Smallcap 250 index has dropped more than 20% from its yearly high.
A 20% decline from peak levels is widely regarded as the threshold for a bear market, highlighting investor unease amid heightened market volatility.
The Nifty Next 50 index has fallen 22.8% from its September 27 peak, including a 0.7% dip on Tuesday. Meanwhile, the NSE Nifty Smallcap 250 Index, representing smallcap firms, has dropped 20.7% from its yearly high after a sharp 3.7% decline on Tuesday.
While the Nifty 50 and BSE Sensex showed resilience on Tuesday, gaining 0.78% and 0.98%, respectively, as of afternoon trading, thanks to optimism over the Reserve Bank of India’s (RBI’s) liquidity-boosting measures, midcap and smallcap indices continued to languish under selling pressure.
The Indian market appears to be oversold and is set for a rebound, said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, adding that the RBI’s announcement of measures to boost the liquidity in the banking system by around Rs 1.5 trillion is positive for the market.
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