Indian stock markets are fairly resilient despite growing India-Pakistan tension and India launching “Operation Sindoor” targeting terror hubs in Pakistan and PoK. Furthermore, it is also interesting to note that it was not the Sensex or Nifty that’s leading gains but the small and the midcap stocks are grabbing all the attention..
The BSE Midcap index rose more than 1%, while the Smallcap index followed with a gain of 0.81% during intraday trade, clearly outpacing the benchmark indices.
Among the key movers in the midcap space, Endurance Technologies led the pack with a jump of 9.96%, followed by Piramal Enterprises rising 7.61%, and Paytm, which added 7.32%. Other notable gainers included Whirlpool (4.43%), Bharat Forge (4.11%) and Muthoot Finance (3.83%).
In the smallcap category, the biggest gains were seen in Timex, which rallied a solid 18.65%, while SP Apparels (SPAL) surged 17.09%. Gokaldas Exports (GOKEX) rose 16.49%, followed by Aarti Drugs (15.75%), Welspun Living (12.65%), and Indo Count Industries (ICIL) which gained 10.77%.
What is fueling the upmove in small and midcaps
Some of the reason behind this surge in the mid and smallcaps despite the tense are as follows –
Limited escalation risk
The precision strikes under Operation Sindoor were described as targeted and non-escalatory. With no engagement against Pakistan’s military directly, markets sensed that tensions might not spiral into a broader conflict.
All eyes on US-China meet
Asian indices got a lift after China rolled out stimulus measures, including interest rate cuts and easing of banking norms.
Adding to this, investors will also keep a close watch on a high-stakes meeting set for this weekend in Switzerland, where US Treasury Secretary Scott Bessent and chief trade negotiator Jamieson Greer are scheduled to hold talks with China’s top economic policymaker He Lifeng. The meeting is being seen as a potential breakthrough in the ongoing trade tensions between the two economic giant.
Expert View: Why the market is not shaken
“What stands out in ‘Operation Sindoor’ from the market perspective is its focused and non-escalatory nature. We have to wait and watch how the enemy reacts to this precision strikes by India. The market is unlikely to be impacted by the retaliatory strike by India since that was known and discounted by the market,” said Dr. VK Vijayakumar, Chief Investment Strategist, Geojit Investments .