Only 30 smallcap stocks offer double-digit weekly returns in a week marred by uncertainty

Indian markets experienced a marginal recovery from the uncertainties arising from concerns about the unwinding of carry trades, driven by the Yen's rapid appreciation and weak macroeconomic data that fuelled recession fears in the US. However, indices closed the week in red, losing over 1% each.

During the week, only 30 smallcap companies offered double-digit returns with Century Enka the top gainer (35%), followed by Authum Investment (34.19%), Symphony (33.53%), and Garware Hi-Tech (26%).

About 5 stocks including Edelweiss Financial Services, BASF India, Venky's, Oswal Greentech among others have offered returns between 20-25%.


In the midcap segment, only one stock Trent rose in double digits with a gain of 13.37%.

Among the Sensex pack, Hindustan Unilever (HUL) topped the charts with 2.05% returns, followed by ITC at 1.32% and Tech Mahindra at -0.26%.

What should investors do?

Analysts said the domestic valuations are not cheap, while first quarter results are painting a moderation in growth. Over the past few days, Nifty has been volatile although some recovery was seen towards the later days.

"So far, 46 companies in Nifty50 index which have published their results have reported PAT growth of 6.12% YoY, which is marginally better than 5.78% expectations. However overall, it seems moderating compared to previous quarters," said Vinod Nair, Head of Research, Geojit Financial Services

In the coming week, investors will closely monitor domestic CPI data for July, which is expected to show some moderation.

"Moving forward, the direction of the domestic market will be influenced by global markets. A lack of fresh triggers and subdued earnings will be a deterrent for higher valuation, investors are advised to shift their focus from growth stocks to value stocks," Nair said.

"India Vix descended from 20 levels to 15 during the week, showing an easing in cautiousness in the market and improvement in sentiments. Going forward, we expect markets to consolidate at higher levels due to mixed global cues and absence of any major domestic triggers," said Siddhartha Khemka, Head - Retail Research, Motilal Oswal.

Technically, analysts say benchmark Nifty has taken support at its 50-DEMA but finding sustained supply near 24350 zone.

"Now, the index requires a decisive range breakout above 24350 or below 24000 zones to commence the next leg of rally but immediate structure is negative so sell on bounce could continue even if we are stuck in this trading range," said Motilal Oswal’s Chandan Taparia.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)