Small-cap stocks face selling pressure as broader markets underperform
![](https://portfolio.investmentguruindia.com/uploads/news/Growth_123.jpg)
Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel
https://t.me/InvestmentGuruIndiacom
Download Telegram App before Joining the Channel
Small-cap stocks are under as the index fell more than 1 per cent on Monday amid concerns over valuations.
BSE Small Cap Index is down 1.2 per cent while the benchmark Sensex is down only 0.34 per cent, down by 255 points.
Among the constituents, JTL Industries is down 15 per cent, BCL Industries is down 12 per cent, Sigachi Industries is down 12 per cent, Tata Chemicals is down 9 per cent, Neuland Labs is down 9 per cent, JM Financial is down 8 per cent, Arvind Ltd. is down 7 per cent, IIFL Finance is down 5 per cent.
The dominant trend in the market in the near-term is likely to be the underperformance of the broader market, particularly the small-cap space, says V.K. Vijayakumar, Chief Investment Strategist, Geojit Financial Services.
Since restraint imposed by some mutual funds by stopping lump sum investment into their small-cap schemes has failed to stem the flow of funds into the over-valued small-cap segment, SEBI has stepped in with regulatory action asking the mutual funds to do stress tests in their mid and small-cap schemes, he said.
More follow up actions are likely from the regulator to prevent a bubble formation in the broader market and its inevitable burst, he said.
Since the market is scaling new highs consistently, the undertone of the market remains bullish and, therefore, investors should remain invested. Large-caps are likely to witness buying on dips while the broader market will face headwinds, he added.
![](https://portfolio.investmentguruindia.com/uploads/news/Harry Bajaj-mobec.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/african22.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/nirmalagdp22.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/GDP117117.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/nirmalaS22.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/GV_Sports.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/niramala22.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/LTIMindtree Ltd.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/pumps motor.jpg)
![](https://portfolio.investmentguruindia.com/uploads/news/jul22v30_NLxKJhR.jpg)
Tag News
![](https://portfolio.investmentguruindia.com/uploads/news/mutual fund 26.jpg)
SBI Mutual Fund files offer document for Nifty 500 Index Fund
![Quote on Pre-budget expectations by Shlok Srivastav, Co-founder & COO, Appreciate, a SEBI and IFSCA registered fintech company](https://portfolio.investmentguruindia.com/uploads/news/Shlok Srivastav, Cofounder COO, Appreciate.jpg)
![Bandhan Mutual Fund files offer document for Business Cycle Fund](https://portfolio.investmentguruindia.com/uploads/news/Mutual Fund_432.jpg)
![SEBI`s regulations for SM REITs likely to drive investor interest towards fractional ownership of real estate assets: Crisil](https://portfolio.investmentguruindia.com/uploads/news/Sebi.jpg)