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Business News/ Markets / Stock Markets/  Rollover Update: Mid- and small-cap indexes shine in November 2023 derivative expiry, says Nuvama
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Rollover Update: Mid- and small-cap indexes shine in November 2023 derivative expiry, says Nuvama

Mid- and small-cap indexes showed remarkable gains in the November 2023 derivative expiry series. The November 2023 derivative expiry series saw a surprising turn of events, with HNIs and retail investors' faith shifting the balance of power in the market's favour, as per brokerage, Nuvama.

The November 2023 derivative expiry series saw strong market performance, with the Nifty Bank and Nifty Index both experiencing gains. The midcap index and small-cap index stood out with impressive gains, reaching record highs, said Nuvama in its report. Premium
The November 2023 derivative expiry series saw strong market performance, with the Nifty Bank and Nifty Index both experiencing gains. The midcap index and small-cap index stood out with impressive gains, reaching record highs, said Nuvama in its report.

Mid- and small-cap realms were the real heroes of the November 2023 derivative expiry series, according to brokerage Nuvama Institutional Equities. The Nifty Midcap jumped a remarkable 12.6%, and the Small-Cap Index gained an even more remarkable 14.4%. These two indexes showed unwavering determination. 

Every day saw them surpass expectations, prove their tenacity, and create an unavoidably compelling success story. Echoing the echoes of triumph, the indexes gracefully settled at record highs. This performance is noteworthy because it approaches the highest gains recorded following the February 2021 series, when the small-cap increased by 12.8% and the midcap soared by 12.7%, said the brokerage in its report.

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On the whole, according to brokerage Nuvama Institutional Equities, the November 2023 derivative expiry series transpired as anything but usual. The beginning was marked by a general gloom that covered India's benchmarks, the Nifty Index and Nifty Bank, which were still suffering from a dismal October series. To further complicate matters, FIIs adopted noticeably bearish positions in index and single-stock futures (SSF).

Also Read: Nifty 50 hits all-time high led by banks, metals, auto stocks; small, midcaps support rally

However, in a surprising turn of events, high net-worth individuals (HNIs) and retail investors' unwavering faith emerged as the protagonist, shifting the balance of power in the market's favour. After a shaky start, the market rallied triumphantly over the next few days.

The Nifty Bank saw a 5.2% increase, closing at 44,482, while the Nifty Index saw a 6.8% gain, closing at 20,133. With gains of 12.6% and 14.4%, respectively, the midcap index and small-cap index stood out during this upward trajectory.

The sectoral indexes that saw the biggest gains in the November series were the FMCG Index (up 4.1%), PSU Bank Index (up 6.7%), Fin serv Index (up 6%), Pvt Bank Index (up 5.3%), Realty Index (up 24.8%), Pharma Index (up 10.9%), Auto Index (up 10%), Metals Index (up 9.7%), Media Index (up 8%), IT Index (up 7.8%), and FMCG Index (up 4.1%). No sector ended in the red.

"However, FPIs who were pulling out money in the first half, started to deploy in the latter half of month which surmounted to the $24 mn worth of inflows in November and now the net inflow from March till date totals to $13.3 bn. On the other hand, DIIs yet again continued to inject funds, nearing an impressive $1.7 bn. While the participation of HNIs and Retail investors is not officially reported, their influence on the market must have undoubtedly been significant," the brokerage said.

Also Read: Unitech to GG Engineering: These 10 penny stocks gave up to 150% in November 2023

Outlook for December Series

Nuvama believes that the market's recent undertone and roll costs strongly indicate the possibility of new highs, and that it may be easy to reach 20,450. However, given the all-time high market and SSF position levels, providing precise targets immediately is difficult.

It will be crucial to monitor and adjust targets as necessary. This weekend's state election results should be volatile, offering chances to increase long bets on any market drops.

Also Read: BSE MidCap and SmallCap hit fresh record highs, up over 35% in CY23 so far

"In terms of sectors, we favour chemicals as a contrarian play due to evident long build-up and cash-led buying support. Realty may consolidate after a significant rally, prompting a gradual unwinding of existing long bets. Auto index momentum is expected to gain steam, warranting a continuation of long positions.

Within Banking, the overall positioning appears mixed. HDFC Bank could see 3-3.5% gains in the next few days, driven by FTSE Rejig wt up on Nov 15, resulting in a net inflow of USD 500 million," the brokerage said.

Also Read: Stock market today: Asit C Mehta board to consider rights issue. Details here

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decision.

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Published: 01 Dec 2023, 11:40 AM IST
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